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Binance - I would rather understand what's going on rather than have something "just work". I have tried to do some reading on these subjects but am struggling to really pin down what each is trying to do and as a result how I should attempt to set up my node to achieve full self-reliance.

Unfortunately, it’s not quite so simple. In merge mining, since all of the chains use the same hashing algorithm, you attempt to generate a proof of work for both blocks together. Merge mining requires the user to run a full node of every currency being merge-mined, which is sufficiently expensive as to dramatically increase the incentive to use mining pools to split up those fixed costs among many miners. Also, in the event that any side chain does get 51% attacked, the risk of stealing bitcoins in the two-way-peg-scheme remains. You use the hashing power only once, but have the chance to generate a successful proof of work for both chains. This creates a strong incentive towards centralization and is generally a very bad thing. One possible solution to the increased risk of 51% attack is to use merge-mining to ensure that all of the side chains are mined simultaneously by the same amount of hashing power. At first glance, this seems to neatly resolve the obvious drawback of side chains.

Moreover, the PoW puzzle described in Bitcoin’s white paper more closely resembles the methodology described by researchers Tuomas Aura, Pekka Nikander, and Jussipekka Leiwo in their 2001 paper DOS-Resistant Authentication with Client Puzzles (which itself builds on Juels and Brainard).

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Tree chains are a scheme that is similar to side chains, but attempts to resolve some of the latter’s practical shortcomings. The scheme, btc as described by Peter Todd, a Bitcoin core dev, is something like this:

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Within days, Back made his first appearance on the Bitcointalk forum, introducing himself as "inventor of hashcash (the bitcoin mining function)." This skepticism may explain why Back appears to have utterly lost interest in Bitcoin after his initial communication with Satoshi, but his interest returned in April 2013, coincidentally around the time that the value of the Bitcoin token hit an all-time high (US$220, after starting the year at just $13.40).

Beyond that, it would also be nice if we could integrate some of the features of the altcoin community (like fast transaction verification), cryptocurrency without needing to actually deal with altcoins (and the cost of moving money between them via an exchange), or necessarily adopting the tradeoffs of those altcoins into the core Bitcoin block chain.

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The full node then sends back all the blue shaded merkle sibling hashes. For example, your SPV wallet sends transaction hash of your interest to full node which is H k assume here. Your SPV node then uses sibling hashes to compute parent hash and then so on till the root level.

The ElectrumX implementation runs with txindex = 1 and downloads full blocks to your system. There's no node maintenance burden on you but the client/app you are using will ping a centralised server in most cases for using their hosted nodes . Electrum server is built on the full node. It is just like another mobile or node less wallets. Check out ElectrumX which lets you run an Electrum server.

imageThat said, many of the properties of a tree chain Bitcoin are exciting, and it seems likely that the future of Bitcoin is going to look very different from the current architecture. To get political for a moment, this sort of dense technical debate reminds us of why attempting to impose broad regulation on Bitcoin prematurely is so foolish: nobody, not even the people building the protocol, know what Bitcoin will look like in a few years’ time, and, even accepting the generous notion of a cautious and well-intentioned regulator, it would be very easy to wind up cumbersome laws that do not make sense, given the transformations that Bitcoin will have undergone.

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