How You Use It
Your application connects to the Arkade operator through the SDK. From there, the flow is straightforward:1
Connect
Initialize the SDK and connect to the operator. This is your entry point into Arkade, similar to connecting to an RPC provider.
2
Transact
Submit transactions through the SDK. They execute instantly in the Virtual Mempool, an offchain subsystem where independent operations run in parallel. You can chain transactions without waiting for block confirmations.
3
Settle
When you want Bitcoin-level finality, anchor your transactions to L1 through batch settlement. Until then, they’re preconfirmed and immediately usable.
4
Exit
Users can always withdraw their funds to Bitcoin L1, even without the operator’s cooperation.
The Operator
The Arkade operator is the server your application connects to. It processes transactions, validates them, and coordinates settlement. The operator cannot steal funds or prevent withdrawals. Its role is bounded by presigned Bitcoin transactions that back every user’s funds. The operator facilitates the fast path; the exit path exists independently of it.How Users Hold Funds
Your balance on Arkade is composed of virtual unspent transaction outputs. They follow the same ownership model as Bitcoin: each VTXO is an independent unit of value that you own and can spend on its own. Think of them as individual bank notes in a wallet rather than a single account balance. Our SDKs use “VTXO” as a shorthand term (getVtxos(), VtxoManager).
Virtual outputs are nested inside Taproot outputs on the Bitcoin blockchain, bundled with other users’ virtual outputs in batch outputs. This nesting is what gives Arkade its scalability: thousands of individual virtual outputs compressed into a single onchain output. Each virtual output has two spending paths: a fast collaborative path (cosigned with the operator) and a unilateral exit path (the owner spends alone after a delay). The collaborative path is the default; the exit path is the safety net.
VTXOs & Ownership
Virtual output structure, batch outputs, the virtual transaction tree, and virtual output states.
Execution
Transactions execute offchain in the Virtual Mempool, a DAG-based engine where independent transactions run in parallel without blocking each other. This is what gives Arkade its throughput, and what makes smart contracts practical: complex logic executes without holding up unrelated transactions elsewhere in the system. When the operator cosigns a transaction, it’s preconfirmed and the resulting virtual outputs become immediately spendable. You can build long chains of operations without ever waiting for a Bitcoin block.Transactions & Execution
Transaction structure, preconfirmation, chaining, and the Virtual Mempool DAG.
Settlement
Preconfirmation is fast but carries a trust assumption: you’re relying on the operator not to cosign a conflicting transaction. When you want full L1 security, you anchor transactions onchain through batch settlement. The entire swap compresses into a single Bitcoin transaction, and afterwards your virtual outputs are secured by Bitcoin consensus directly. No operator trust required. You choose when to settle. Applications handling high-value transfers should settle frequently. Lower-value, high-throughput operations can stay preconfirmed longer and settle in batches.Settlement & Finality
Batch swaps, commitment transactions, connector outputs, and the settlement process.
Lifecycle
Virtual outputs expire. This is deliberate: expiration lets the operator recycle capital efficiently and keeps the onchain footprint compact. Before a virtual output expires, it needs to be renewed through a batch swap. The SDK handles this automatically, and renewal can be delegated to third parties without giving up custody.VTXO Lifecycle & Liveness
Batch expiry, renewal, delegation options, and liveness requirements.
Security
Every virtual output comes with presigned Bitcoin transactions that can be broadcast at any time. This is the self-custody guarantee. On top of that, the Arkade Signer runs in a Trusted Execution Environment (TEE), isolating signing authority from operator control. Communication is end-to-end encrypted.Security & Trust Model
Unilateral exits, the Arkade Signer, verifiable execution, and risk analysis.