Bitcoin Ecosystem Works to Improve Token Validity and Scalability Through Indexers

The Bitcoin ecosystem has been working to improve token validity and scalability through various indexers.

Jon Southurst asked, in 2022, 'How do you prove a token is valid through a string of transactions that may last for years or even centuries?'

Every protocol on BSV answers this question with an indexer somewhere in the stack. The lowest possible level solution asks the node for state, but this doesn't scale.

One solution is to put token rules in a locking script itself, as in STAS (STAS-789 template). This adds data to every transfer and forbids deletion, growing with its own history.

BOLT took a different approach by making transactions prove their lineage in script, eliminating the need for indexers. However, this solution is still being tested.

The 1Sat protocol puts token rules in an open deterministic overlay, keeping transactions light to nodes. This option costs roughly double a simple payment but allows for more complex contracts.

Mandala Network's three-layer design includes a Teranode Layer for high-speed processing and an Overlay Service Layer for specialization and business logic.

The base layer should not be modified, as it was never intended to accommodate application semantics. Tokens should live in the attic and anchor to the base, leveraging fixed base with infinite attic.