Mark the Stratum v2 release as a victory for the open-source bitcoin community. For a decade, it has been the software of choice for miners to interact with pools and with the bitcoin protocol per se. While still necessary, bitcoin mining pools have a centralizing effect. With Stratum v2, miners will get to construct their own blocks. And that’s just one of the innovations, although the most talked-about one.

The Stratum v2 official website defines itself as “the next generation protocol for pooled mining. It increases security, makes data transfers more efficient, and reduces mining infrastructure requirements. It also introduces three new sub-protocols that let miners select transaction sets and improve decentralization by negotiating with pools.” Not only that, the software is an “independent, community-run, and fully open-source implementation of the SV2 protocol” and it’s “available for pilot testing immediately.”

One giant leap for #bitcoin mining…

The Stratum V2 reference implementation (SRI) is here. This independent, community-run, and fully open-source implementation of the SV2 protocol is available for pilot testing immediately.

— Stratum v2 (@StratumV2) October 11, 2022

Stratum v2 And The Road To Job Negotiation

In this first implementation, users don’t get to construct their own blocks just yet. According to Stratum v2, “This release will be followed by a more robust version in November, allowing miners to select their own work and negotiate with pools through the Job Negotiation protocol. Our SRI Pool code will also be ready by then, letting pools help us test things.”

This release will be followed by a more robust version in November, allowing miners to select their own work and negotiate with pools through the Job Negotiation protocol. Our SRI Pool code will also be ready by then, letting pools help us test things. pic.twitter.com/iLtFev198l

— Stratum v2 (@StratumV2) October 11, 2022

What is Job Negotiation exactly, though? On March 3rd, 2021, mining company Braiins defined it as “a sub-protocol that enables miners to construct their own blocks, a task currently only being done by pools.” They also clarified why the first iteration of the Stratum v2 protocol doesn’t have Job Negotiation enabled just yet. “The reason is that there are changes necessary in Bitcoin Core in order to make Job Negotiation possible. So there can’t be a full implementation of Stratum V2 until those changes are made.”

1/ Stratum V2 Overview & Update

Over the past year, we’ve explained many benefits of the Stratum V2 mining protocol for miners, pools, and the Bitcoin network as a whole.

Now it’s time for a recap thread & update on development + adoption. pic.twitter.com/j0bCj3G6yS

— Braiins Insights (@BraiinsInsights) March 3, 2021

Other Superpowers That It Brings To The Table

All of these promises come from the protocol’s website:

• “By-default encryption and NOISE protocol authentication, hardening the protocol against man-in-the-middle attacks.”
• Stratum v2 “optimizes data transfer size and frequency between miners, proxies, and pool operators.”
• Stratum v2 “improves logic and framework by letting miners and mining pools running V1 make incremental and modular improvements.” 
• Stratum v2 further decentralizes bitcoin by “letting end-miners build and select transaction sets and block templates.”
• It ensures “cross-compatibility between and pools and end-mining devices.”

Plus, there’s what Spiral lead Steve Lee told CNBC:

“All told, much less data needs to be transmitted between miners and pools, and this could help miners in remote regions of the world with poor internet.”

BTC price chart for 10/11/2022 on Coinbase | Source: BTC/USD on TradingView.com
𝗦𝘁𝗿𝗮𝘁𝘂𝗺 v𝟮, Development & Adoption

The preliminary release wasn’t today’s only story regarding Stratum v2. Mining company Braiins paired it with their announcement of “a working group established with Spiral to accelerate adoption of Stratum v2, along with the release of the first open-source SV2 reference implementation.” So, big names are pushing the completely open-source software. Because it’s important.

𝗦𝘁𝗿𝗮𝘁𝘂𝗺 𝗩𝟮 Development & Adoption Update

In short… it’s happening!

Today we’re announcing a working group established with @spiralbtc to accelerate adoption of @StratumV2, along with the release of the first open-source SV2 reference implementation (SRI). [1/7] pic.twitter.com/UZQbANYVH6

— Braiins (@BraiinsMining) October 11, 2022

The Braiins + Spiral collaboration will be a working group that “helps coordinate adoption across all mining companies and other compatible implementations both closed- and open-source to ensure that all Stratum V2 projects can interact with each other based on the protocol standards.”

Let’s close this with the words of Braiins’ co-founder Jan Capek, who told CNBC:

“Universal standards for running and building Stratum v2 and the efforts of this working group to push the industry forward will provide the momentum bitcoin needs to finally upgrade from a version of its mining protocol that was built a decade ago.”

This is going to be an important story moving forward. Let’s keep an eye on Stratum v2.

Featured Image: SV2 diagram from this tweet| Charts by TradingView