• Cryptoasset Report
  • March 6, 2020

TrueBit is a distributed marketplace for off-chain computation of resource-intensive smart contracts, verifying proper results using a game theory-based incentive structure rather than cryptographic proofs.


TrueBit is an off-chain computation layer containing a distributed marketplace for the execution of resource-intensive smart contracts, which may otherwise be economically irrational due to high gas costs, technically impossible due to gas block limits, or procedurally inadvisable due to the Verifier’s Dilemma. Diverging from other emerging methods of off-chain computation, such as trusted execution environments and ZK-Rollups, TrueBit relies on a game theory-based incentive structure, rather than cryptographic proofs, to verify proper execution. The project is led by Dr. Jason Teutsch, a mathematician and former RAND Corporation Fellow, and Dr. Christian Reitwiessner, the Ethereum Foundation’s Solidity and C++ implementation lead. Polychain Capital, the project’s main financial backer, played a significant and active role in TrueBit’s development.

Protocol Details

TrueBit is designed to operate adjacent to Nakamoto Consensus-based, Proof-of-Work smart contract platforms; its core protocol serves as an off-chain computational layer upon which smart contract execution may occur unbounded by the computational limitations of existing platforms. That is, TrueBit seeks to eliminate de jure limitations on smart contract complexity by gas fees and gas block limits, while also addressing de facto barriers arising from the Verifier’s Dilemma, through an alternative incentive structure and verification protocol. As projects seeking to implement off-chain computation layers proliferate, TrueBit differentiates itself by relying on a multi-party ‘verification game’—rather than merely cryptographic proofs—to ensure proper execution. Initial development has focused on TrueBit’s application as an Ethereum Layer 2 solution and seeks to instantiate the protocol as an Ethereum smart contract and operating system for interaction therewith, producing and communicating computational results.

In the Ethereum network, every smart contract operation must be performed by every node via the Ethereum Virtual Machine (EVM). As this consumes the network’s computational resources, a ‘gas’ fee is levied for each computational step, with the total gas fee being a function of the contract’s overall computational requirements. Thus, complex smart contracts often require high gas fees such that they are not economically rational to deploy. Further, the network itself imposes a gas block limit, placing an upper bound on the amount of gas—and computational resources—that may be used within any given block and making significantly complex smart contracts technically impossible to deploy. Employing individual actors to compute smart contracts, TrueBit reduces computation fees by avoiding the redundancy and inefficiency of the EVM’s execution procedures. Likewise, off-chain computation on TrueBitOS, as opposed to on-chain EVM computation, bypasses block gas limits altogether, as it is now only the final transaction outcome that must then be included in an Ethereum block. In addressing these gas-based obstacles, at a high level, TrueBit takes a common approach adopted by many of its Ethereum L2 peers.

Another—and perhaps more nuanced—problem posed by Ethereum’s smart contract execution procedure and incentive structure is the hypothesized Verifier’s Dilemma. That is, because block producers receive rewards but block verifiers do not, nodes are incentivized to expend resources mining the next block rather than properly verifying proposed blocks, doing so at the expense of the network’s overall security. A major consequence of such practices is that complex smart contracts may be improperly executed and their results left unchallenged or, in some cases, excluded from blocks altogether.

To address this procedural shortcoming, TrueBit introduces a novel ‘verification game,’ in which a game-theory based approach is used to challenge and verify proper smart contract execution. At a high level, the game begins when a user requests execution of a complex smart contract via TrueBit’s user interface, the results of which are computed by a consenting third-party ‘solver’ and made available for public auditing. Any third-party ‘challenger’ may then choose to dispute the results, at which point the computation is delimited by time intervals. Computation is then examined in multiple steps, with each consecutive ‘round’ examining a smaller subset of the computation until the source of the error is found. ‘Judges,’ roles that may be assumed by any existing Ethereum node, are responsible for enforcing the rules of this game and adjudicating any further disputes; both solvers and challengers stake cryptoassets and are slashed and rewarded according to the accuracy, or lack thereof, of the original computation. All solving and challenging is done using TrueBitOS, which functions similarly to the EVM with regard to the hosting of smart contract computation.

However, because this verification game theoretically only requires one honest actor to ensure proper execution, improper execution is unlikely to become prevalent; diminishing incentives for and participation from challengers is a foreseeable consequence. To mitigate such risks, TrueBit implements the concept of ‘forced error.’ That is, the protocol itself periodically submits invalid smart contract results, of which successful challengers receive a ‘bounty’ so large that the expected value from challenging remains positive regardless of solvers’ collective honesty, incentivizing continued challenging of computation.

Asset Details

TRU tokens are TrueBit’s freely-tradable, fungible, native cryptoassets. These ERC-20 tokens’ main functions within the TrueBit ecosystem are payment for computation and staking for solvers and challengers. Further, the network levies a minor ‘verification tax’ on payments made within the ecosystem in TRU tokens in order to fund the bounty pool for forced error situations. While designed primarily for use on the Ethereum blockchain, it is theoretically possible for TRU tokens to be transferred to other blockchains alongside which TrueBit is operating via a ‘burn-and-mint’ mechanism. TrueBit. TrueBit did not hold a token sale, and its development was instead supported only by equity fundraising, primarily obtained from Polychain Capital.