Lightning Labs, a leading Lightning Network infrastructure firm, has revealed a new solution to streamline the process of minting new assets on the Bitcoin network. The updated version of the Taproot Assets Protocol, which was recently rebranded, offers a more efficient approach to asset creation on the blockchain.
In a blog post published on May 16, Lightning Labs criticized the existing methods of asset inscription on the Bitcoin blockchain, referring to them as “particularly inefficient.” They specifically highlighted the cumbersome protocols that involve writing asset metadata “directly into block space.”
The Taproot Assets Protocol aims to operate primarily off-chain to avoid the network congestion that has become a prevalent issue on the Bitcoin network since the introduction of the BRC-20 token standard by anonymous developer “Domo” on March 8.
Lightning Labs announced that Protocol users will soon be able to integrate BRC-20 assets into the Lightning Network seamlessly. This means wallets, exchanges, and merchants can be ported over instead of having to build an entirely new ecosystem from scratch.
Most BRC-20 tokens created thus far have utilized Ordinal inscriptions of JSON data for deploying token contracts, minting tokens, and transferring them. However, this approach has faced criticism from developers who argue that it incurs significantly higher transaction fees compared to using binary.
The Taproot Assets Protocol, previously known as the “Taro” protocol, underwent a rebranding due to a trademark infringement lawsuit filed by blockchain development firm Tari Labs on December 8 of the previous year. Lightning Labs had to change the name of the software as a result.
Although the total value of BRC-20 tokens briefly exceeded $1 billion on May 9, it has since declined to $500 million, experiencing a drop of nearly 50%.