OP_CAT Peg: A Trustless Two-Way Bridge
The OP_CAT Peg introduces a revolutionary trustless two-way bridge between Bitcoin’s base layer and the OP_CAT Layer, addressing a decade-old "holy grail" challenge in Bitcoin’s ecosystem. By leveraging Simplified Payment Verification (SPV) proofs, it enables secure, on-chain peg-in and peg-out operations without custodians or third-party dependencies. The two-way peg is the linchpin of the OP_CAT Layer, enabling secure, trustless asset movement from and to Bitcoin’s main chain. It consists of a peg-in process (locking bitcoins on the main chain to mint OP_CAT Layer assets) and a peg-out process (redeeming OP_CAT Layer assets back to bitcoins), with OP_CAT playing a pivotal role.
The diagram illustrates the complete process of transferring funds between Bitcoin and the OP_CAT Layer through the trustless two-way OP_CAT Peg implemented with SPV proofs.
The peg-in process begins with a peg-in transaction where BTC is locked (orange block). The OP_CAT Peg detects this transaction and waits for sufficient Bitcoin confirmations before generating an SPV proof. This proof signals the OP_CAT Layer to mint corresponding tokens (green block), which are confirmed after a Layer reorganization wait period, completing the peg-in process.
The peg-out process reverses this flow. The diagram demonstrates the permissionless, decentralized nature of the system, with the OP_CAT Peg facilitating secure asset movement using SPV proofs without requiring intermediaries.
Since OP_CAT is not yet activated on Bitcoin mainnet, we have decided to launch the OP_CAT Layer bridge in two phases:
Phase-1: Before OP_CAT is enabled on Bitcoin
A secured multi-signature solution will be employed, based on Safeheron services and other open-source, production-ready industry components. Every peg-in and peg-out transaction will be verified and signed by core ecosystem participants.
Phase-2: After OP_CAT is enabled on Bitcoin
The peg-in and peg-out processes will transition to a smart contract-based solution as described above, achieving a truly trustless two-way bridge.