Eric Wall, Udi Wertheimer and Francisco Alarcon: Upgrading Bitcoin With Covenants

Taproot Wizards, a collection of 2,108 JPEGs inscribed on Bitcoin using the Ordinals protocol, headed into 2024 on the heels of <a href=”https://www.coindesk.com/tech/2024/01/12/taproot-wizards-bitcoin-ordinals-project-that-raised-75m-to-sell-quantum-cats-collection” target=”_blank”>a $7.5 million seed funding round</a>, which was promptly exceeded by the sale of <a href=”https://magiceden.io/ordinals/marketplace/quantum_cats” target=”_blank”>Quantum Cats</a>, a digital art collection of brightly-colored felines. The sale of 3,000 NFT-like collectibles netted 300 BTC, worth around $13 million at the time and now worth more than double that.

Founded by Eric Wall, Udi Wertheimer and Francisco Alarcon, Taproot Wizards says its mission is to “make bitcoin magical again,” harking back to a 2013 meme describing BTC as “magic internet money.” The project is now turning its focus to upgrading Bitcoin itself using the proposed <a href=”https://www.coindesk.com/tech/2024/02/14/satoshi-era-bitcoin-function-op-cat-dusted-off-as-development-fervor-grows” target=”_blank”>OP_CAT protocol</a>, a program that was initially built into Bitcoin by Satoshi Nakamoto, but removed after concerns were raised about excessive memory usage and potential vulnerabilities.

There is now an initiative to upgrade the network by including OP_CAT, which could enable more sophisticated applications on Bitcoin. It works by introducing “covenants,” or rules that can determine how a specific transaction will function. The Taproot Wizards founders are among the biggest proponents of OP_CAT, and created the Quantum Cats collection as a marketing campaign for the proposal.

“CAT-based covenants would allow Bitcoin users to trade between BTC and stablecoins on-chain, borrow with BTC as collateral, bridge their bitcoin to other chains and use new types of layer 2,” says Wertheimer.

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