# nBTC v0.2 protocol

Public developer release · September 24, 2026 · DCLXVI LC

## Origin

The first block in each local demonstration has height −1 and references Bitcoin's displayed genesis hash:

`000000000019d6689c085ae165831e934ff763ae46a2a6c172b3f1b60a8ce26f`

Subsequent heights decrement. Each block commits to the previous nBTC block through `toward_zero`. The network manifest additionally commits to the hash of Ben Đ Om's original experimental Block −1:

`5f0ee3e5d7898f19d9044b0963a37089aba00ce4f95901a77296452700000000`

The experiment and the prototype's first ledger block are distinct objects. The experimental header is retained as historical origin evidence; it is not inserted into Bitcoin. Bitcoin has no reciprocal reference to this ledger, and the prototype does not inherit Bitcoin consensus security.

Negative height is an indexing convention. SHA256 has no separate negative search space, and no inversion method has been demonstrated.

## Original experiment

| Field | Value |
| --- | --- |
| Version | 1 |
| Timestamp | 1231005905 |
| Bits | 0x1d00ffff |
| Nonce | 1598612817 |
| Previous bytes | 445be54d48a2e6294369c84c61cd0929209d4e1084536159bdf7002bddfe094b |
| Inscription hash bytes | d71b99d46cb3ddaae3563704273f32b9122e6b37cccbce418bf2a49acfa32a34 |

Those previous and inscription bytes are used directly in the 80-byte header; version, timestamp, bits, and nonce use little-endian serialization. The experimental Merkle field is SHA256 of the inscription text, not a demonstrated Bitcoin transaction Merkle root.

Double-SHA256 yields the raw digest:

`0000000027459672a70159f9e40ca0ab8970a363094b04d9198f89d7e5e30e5f`

Reversing these bytes gives the recorded display hash above. The raw big-endian integer satisfies the encoded target; Bitcoin's little-endian integer interpretation does not. This distinguishes a reproducible experimental work result from a Bitcoin-valid block. The recorded timestamp alone establishes no historical publication date.

## Hashing and accounts

New ledger hashes consistently use the raw double-SHA256 digest as a big-endian integer. Domain-separated restricted canonical JSON commits to the network manifest, blocks, ordered events, and account state. Amounts are integer atoms: 100 million atoms per unit.

Ed25519 signatures authorize account operations. Commands carry a network identity, expiry, account epoch, and relevant nonce. Transfers require the current owner, sufficient balance, and a different enrolled recipient. Replaying a previously accepted transfer is rejected. A failed block leaves the original state unchanged.

The network identity includes the treasury account and all protocol parameters. Each demo run creates a new demonstration identity; it does not join a common network. A future network requires a single agreed manifest, validators, and consensus.

## Recovery

Every account enrolls one owner and five distinct guardian keys, all with proof of possession. At least three guardians and the proposed replacement key sign a recovery request. Outgoing transfers freeze, while incoming credits may continue. The existing owner can cancel before the deadline. After the deadline, an unsigned finalization event can activate the already-authorized new owner key. The account identity and existing balance are retained, and the incremented owner epoch invalidates prior owner commands.

The delay is six block ordinals in the default demo. This deliberately cheap local mining does not provide a real-time security delay. Production deployment needs a defined challenge period, consensus rules, guardian operations, and recovery access.

This path addresses a lost owner key. A stolen owner key can veto before the deadline, a dishonest quorum can seize an unattended account, and missing guardians can prevent recovery. Guardian rotation, estate succession, and institutional adjudication are not implemented. No dormant-account confiscation rule exists. Recovery changes control of existing units instead of creating duplicate replacement coins.

## Proposed issuance

| Parameter | Demonstration setting |
| --- | ---: |
| Supply ceiling | 21,000,000 nBTC |
| Declared initial treasury allocation | 2,100,000 nBTC |
| Initial mining reward | 45 nBTC |
| Halving interval | 210,000 blocks |
| Eventual issuance with integer rounding | 20,999,999.979 nBTC |
| Minimum transfer fee | 0.00001000 nBTC |

These are prototype parameters for review. Founder vesting and an institutional treasury are not implemented. Recorded demonstration balances are neither public holdings nor claims to real funds.

## LSM financing

A future agreement could assign defined rights to actual LSM licensing receipts. The software currently grants no IP, royalty, cash, or BTC rights. An estimated valuation is not a reserve or a promise of redemption. No tokens are offered for sale on the release page.

## Current boundary

Implemented: local validation, mining at a low test target, account registration, signed transfers, delayed guardian recovery, capped issuance, export, and replay.

Not implemented: P2P consensus, difficulty adjustment, reorganization handling, permanent wallet custody, guardian rotation, market integration, a Bitcoin bridge, financial issuance, or cash distribution.

## References

- Bitcoin header serialization and targets: https://developer.bitcoin.org/reference/block_chain.html
- NIST hash-function security properties: https://csrc.nist.gov/projects/hash-functions
- Ed25519 API documentation: https://cryptography.io/en/latest/hazmat/primitives/asymmetric/ed25519/

## v0.2 physical registry extension

The v0.1 ledger and original nine-block example are retained unchanged. `registry.py` subclasses the ledger with a distinct network manifest and physical escrow operations. See `REGISTRY.md` for the complete signed command model, 90-day renewable credentials, seven-day loss challenge, 365-day inactivity threshold, 30-day notice, current-holder claim preservation, and recoverable issuer authority. Printing shells creates no supply. Local clocks and key custody remain demonstration facilities, not production services.