Exclusive Interview with Nubit Founder: How to Build the First DA Layer of the Bitcoin Ecosystem

Author: BlockBeats

Recently concluded, the Bitcoin Asia Conference provided BlockBeats the opportunity to interview one of the founders of Nubit, Professor Yu Feng from the Computer Science Department at the University of California, Santa Barbara. He shared his personal experiences and how he led his team to develop the first DA layer project in the Bitcoin ecosystem—Nubit. As a computer security expert, his exploration and innovation within the Bitcoin ecosystem are noteworthy. In the interview, Professor Yu Feng discussed the development history of Nubit, its technical features, and his outlook on the future of the Bitcoin ecosystem.

Professor Yu Feng stated that the development of Nubit began with an analysis of the infrastructure needs of the Bitcoin ecosystem. Due to the limited throughput of the Bitcoin mainnet, there was an urgent need for a native DA solution. Therefore, Nubit was born to address the infrastructure issues within the Bitcoin ecosystem, laying a solid foundation for its long-term development. Additionally, he introduced Nubit’s technical characteristics and security measures, and shared the progress the team has made in market expansion and ecosystem collaboration.

Regarding the future of the Bitcoin ecosystem, Professor Yu Feng indicated that the next breakout point may lie in developing applications that can generate widespread user interest and demand, such as games or other innovative technologies. He believes these applications will drive the development of the entire ecosystem and promote the continued growth of the Bitcoin ecosystem.

Here is the original interview content:

Please introduce yourself first. When did you enter the crypto industry? What attracted you to the narrative of cryptocurrencies?

Yu Feng: I am Yu Feng, the founder of Nubit and a professor in the Computer Science Department at the University of California, Santa Barbara. My research primarily focuses on software security and programming languages. I started getting involved with cryptocurrencies in 2014 while I was still a PhD student, intending to conduct research on Bitcoin, but my advisor disagreed. It wasn't until I became a professor in 2018 that I began researching blockchain, particularly in security.

I believe cryptocurrencies represent a form of freedom, and decentralization is something many who value freedom admire. For me, the freedom of cryptocurrencies and their value are intertwined. As for why I chose Bitcoin, there was no Ethereum before 2014, and at that time, cryptocurrencies were mainly Bitcoin, which was the earliest currency popular among a small group of people. Later, with the rapid development of the Ethereum community, I also began researching Ethereum and became a developer and researcher in the Ethereum ecosystem.

How has your academic background and personal pursuits influenced your understanding of Bitcoin, including your persistence in this field despite skepticism towards cryptocurrencies?

Yu Feng: Starting in 2017, we had been conducting research on Ethereum security in universities for some time. Last year, we decided to shift our focus to building the Bitcoin ecosystem. In 2022, I founded my first company, focusing on providing security auditing services for projects in the Ethereum community, including smart contracts and zk technologies.

By the end of last year, I discussed with several of my students the limitations of our work's impact on users. We realized that while our services were crucial for the B-side, the direct impact on the C-side was limited. We decided to expand into consumer-facing projects.

Noticing that the Ethereum community was already very mature, we thought that communities lacking infrastructure might offer more development opportunities. One of my students, who is now another founder of Nubit, suggested we shift to the Bitcoin field, as this area was particularly lacking in infrastructure.

Especially at the beginning of last year, my students had already begun to pay attention to new technological developments in the Bitcoin ecosystem, which was still in a very early stage. We decided to start from the Bitcoin direction, not anticipating the explosive growth of this community.

Initially, we entered the Bitcoin ecosystem to continue our security work, as we had rich experience in this area. However, upon further understanding, we found that the entire ecosystem was at a very early stage, with even basic ecological needs unmet. For example, a project had just been hacked for four to five million dollars, indicating that security remained crucial, but the lack of infrastructure was a more pressing issue. For instance, Bitcoin's data throughput is far inferior to that of Ethereum.

Thus, we decided to start with infrastructure development to help the community grow before addressing security issues. We analyzed market demands and found that printing a simple image on Bitcoin could cost hundreds of dollars, highlighting the severe lack of data processing capabilities. We decided to tackle this issue to lay a solid foundation for the community's long-term development, leading to the birth of Nubit.

As the first DA layer project in the Bitcoin ecosystem, Nubit has made remarkable progress within just six months of its establishment. Can you briefly introduce Nubit and its current achievements?

Yu Feng: Nubit is the first Bitcoin DA project developed by our team and the first of its kind in the Bitcoin ecosystem. Nubit primarily aims to address the insufficient throughput of the Bitcoin mainnet by providing a native DA solution. Our project has been established for less than a year but has already gained significant recognition and progress.

From a product perspective, we have completed pre-alpha testing and are about to start the final alpha testing. Additionally, we have developed an execution layer based on the Nubit DA framework, which is stateless and efficient, allowing users to reliably verify computational results, which will be widely used in Bitcoin wallets and by users.

In terms of market and ecosystem, Nubit has gained a certain level of recognition in Asia, with the number of fans growing from a few dozen to over 100,000. We have established deep cooperative relationships with several leading projects from both the East and West, such as Babylon, Merlin Chain, and Polyhedra. These collaborations are not just superficial handshakes but involve genuine use of our solutions.

From a financing perspective, since our establishment last Christmas, we have completed three rounds of financing, raising over $12 million, with major investors including industry-leading institutions like Polychain and dao5.

In terms of the team, we have grown from the initial three founders, including myself and my two PhD students, to a medium-sized team of over 30 people, covering various aspects such as marketing, sales, product development, and research.

What distinguishes Nubit from other DA solutions?

Yu Feng: Compared to other Bitcoin DA projects in the market, Nubit has several unique advantages. First, we provide a truly decentralized solution, unlike some more centralized DA solutions in the market that typically rely on a small server cluster to maintain data availability.

Secondly, our economic security is guaranteed by Bitcoin stakers. Unlike other DA solutions that depend on a single project or a smaller user base, our model involves thousands of stakers, enhancing the overall security of the system.

Finally, our consensus layer is fundamentally different from existing Bitcoin or Ethereum DAs, supporting hundreds of thousands of stakers, ensuring the highest degree of decentralization and security.

Why does Nubit attempt to use its own chain's DA instead of BTC L1's DA?

Yu Feng: Just like vehicle restrictions in Beijing, the throughput of the Bitcoin mainnet is currently extremely limited, similar to all vehicles congested on the second ring road during peak hours. In contrast, traditional banking systems, Visa, or UnionPay can handle about 20,000 to 30,000 transactions per second, Ethereum about 30 transactions per second, while the Bitcoin mainnet can only process about four transactions per second. Therefore, Nubit is positioned as a Bitcoin DA strategy to help alleviate the storage burden of Bitcoin Layer 1.

How does Nubit handle network fee settlement?

Yu Feng: Nubit network fees can be settled in two ways: one is to pay directly using Nubit’s native token, and the other is through Bitcoin payments, which requires a cross-chain bridge based on the Lightning Network.

These two settlement methods are designed to ensure Nubit’s economic security, avoiding reliance on a single staking system, thereby reducing the risk of the entire network being affected by a single economic event. For example, if a settlement method based on Nubit staking were used, economic security would depend on Nubit’s stakers. If any issues arise, such as threats to the economic security of stakers, the entire ecosystem could be affected.

Nubit Architecture

Ultimately, the choice of a Bitcoin staking-based solution is because this method aligns more closely with Bitcoin's native spirit and technical architecture while providing users with more choices and security. Users can choose to invest using Nubit or rely solely on Bitcoin staking to maintain the network's stability and security. This approach aims to ensure that the Nubit network can effectively support the development of the Bitcoin ecosystem, rather than just providing a simple payment solution.

How does Nubit ensure security?

Yu Feng: In the Web3 security field, we ensure Nubit’s security from three main aspects. The first is economic security, which we place great emphasis on. Nubit integrates Babylon’s POS staking solution, ensuring that the economic security of the entire DA ecosystem is determined by Bitcoin's native stakers.

The second layer is the security of the consensus layer. This involves the transaction verification process, i.e., how to determine whether a transaction is valid. Our consensus mechanism is designed based on a high-performance support scheme, unlike other DA solutions in the market, where some projects can support only over 200 stakers, while our solution, once launched, can support hundreds of thousands of stakers. This scale of staker support significantly enhances the degree of decentralization, almost approaching Bitcoin's native level of decentralization.

The third point is the security at the code level. No matter how well designed, if the code implementation is poor, problems may arise. Therefore, we pay great attention to security in code implementation. Our code is currently undergoing the final round of testnet phase and has been audited by three top security auditing firms. Additionally, our internal team is conducting formal verification of some core code to ensure everything runs smoothly.

Does the development of Ethereum's DA layer provide insights for the development of Bitcoin's DA?

Yu Feng: When developing the DA project for the Bitcoin ecosystem, we do pay attention to the DA developments in the Ethereum ecosystem, as Ethereum's DA development is more mature and rich compared to Bitcoin. This borrowing is necessary in the early stages, as it helps us quickly establish our own technical foundation and ecological applications. However, simply mimicking Ethereum's solutions is not sufficient to support the healthy long-term development of the Bitcoin ecosystem.

There are significant differences between Bitcoin and Ethereum in terms of ecosystem maturity, technical genes, and mainnet characteristics. For example, for Ethereum, the DA layer enhances its already rich mainnet functions, while for Bitcoin, due to its extremely limited transaction processing capacity (only about four transactions per second), the development of the DA layer is more about addressing urgent needs.

Therefore, while we can borrow some technical solutions from Ethereum in the early stages, for the sustainable development of Bitcoin, we need to explore paths that are more suited to its characteristics. This means not just patching existing problems but developing unique technologies and strategies that truly meet the needs and characteristics of the Bitcoin ecosystem. Such exploration and innovation are necessary to ensure the long-term and healthy development of Bitcoin DA.

What progress has Nubit made so far? What are the next plans?

Yu Feng: Nubit has made significant progress. First, we completed pre-alpha testing in mid-October last year, which lasted less than two weeks and attracted over 160,000 participants, generating nearly 600,000 transactions. We are currently preparing to launch the first phase of the final testnet, expected to start this week.

In terms of technology and security, our relevant code has been submitted to three top auditing firms for review. Additionally, Nubit has supported mainstream Layer 2 SDKs, including Polygon CDK, OP, etc., further ensuring that our technical platform can effectively support and be compatible with existing mainstream technologies.

Regarding partnerships, we have recently completed deep integrations with several important industry partners. These collaborations are not just superficial relationships but involve substantial technical integration, and they have fully supported and used Nubit’s services in the testnet.

Our next plan is to complete the final round of the testnet and then officially launch the mainnet in the second half of this year. At the same time, we are actively promoting Nubit’s recognition in the European and American communities to expand our market influence. These steps are all aimed at ensuring that Nubit can provide stable and secure services when launching the mainnet and gain widespread application and recognition globally.

Where do you think the next breakout point for the Bitcoin ecosystem will be? What role will Nubit play in the next wave?

Yu Feng: The Bitcoin ecosystem's start in the West is indeed later than in the East. Nevertheless, the West has shown a more robust pace in developing Bitcoin-related projects. For example, while Western projects may not respond as quickly as Eastern ones, they tend to focus more on differentiation and in-depth research, unlike many Eastern projects that prioritize rapid iteration and TVL competition.

In the Bitcoin ecosystem, many early projects were simply copying Ethereum's solutions, whether Layer 2 or other DeFi projects. However, while this model may help with rapid initial growth, it is not sufficient to support the long-term and healthy development of the ecosystem, as there are fundamental differences in technical foundations and ecosystem maturity between Bitcoin and Ethereum.

Currently, although the Bitcoin ecosystem is slowing down, this slowdown is actually a healthier and more normal state. It indicates that the ecosystem needs to shift from relying on simple copying or borrowing to developing innovative solutions that better fit Bitcoin's characteristics. This includes developing leading applications that can genuinely attract user engagement, rather than just investment-type applications like Restaking.

The next breakout point for the Bitcoin ecosystem may lie in developing applications that can generate widespread user interest and demand, such as games or other innovative technologies. These applications will not only increase transaction volume but also drive the development of the entire chain, forming a mutually reinforcing ecosystem from DA to Layer 2 and then to specific applications.

For instance, without a real ecosystem and user participation, even infrastructure like Nubit would struggle to develop independently. The success of the entire ecosystem relies on the participation of real users and the actual use of applications, which will be key factors in driving the further development of the Bitcoin ecosystem.