Return-Path: Received: from smtp1.osuosl.org (smtp1.osuosl.org [IPv6:2605:bc80:3010::138]) by lists.linuxfoundation.org (Postfix) with ESMTP id 39B1AC002A for ; Thu, 25 May 2023 16:07:14 +0000 (UTC) Received: from localhost (localhost [127.0.0.1]) by smtp1.osuosl.org (Postfix) with ESMTP id 14A2283AAD for ; Thu, 25 May 2023 16:07:14 +0000 (UTC) DKIM-Filter: OpenDKIM Filter v2.11.0 smtp1.osuosl.org 14A2283AAD Authentication-Results: smtp1.osuosl.org; dkim=pass (2048-bit key) header.d=gmail.com header.i=@gmail.com header.a=rsa-sha256 header.s=20221208 header.b=Oe6XWv+j X-Virus-Scanned: amavisd-new at osuosl.org X-Spam-Flag: NO X-Spam-Score: -2.098 X-Spam-Level: X-Spam-Status: No, score=-2.098 tagged_above=-999 required=5 tests=[BAYES_00=-1.9, DKIM_SIGNED=0.1, DKIM_VALID=-0.1, DKIM_VALID_AU=-0.1, DKIM_VALID_EF=-0.1, FREEMAIL_FROM=0.001, HTML_MESSAGE=0.001, RCVD_IN_DNSWL_NONE=-0.0001, SPF_HELO_NONE=0.001, SPF_PASS=-0.001] autolearn=ham autolearn_force=no Received: from smtp1.osuosl.org ([127.0.0.1]) by localhost (smtp1.osuosl.org [127.0.0.1]) (amavisd-new, port 10024) with ESMTP id Z2ZCQRBGBlkA for ; Thu, 25 May 2023 16:07:12 +0000 (UTC) X-Greylist: whitelisted by SQLgrey-1.8.0 DKIM-Filter: OpenDKIM Filter v2.11.0 smtp1.osuosl.org 8575483A9E Received: from mail-lj1-x22a.google.com (mail-lj1-x22a.google.com [IPv6:2a00:1450:4864:20::22a]) by smtp1.osuosl.org (Postfix) with ESMTPS id 8575483A9E for ; Thu, 25 May 2023 16:07:11 +0000 (UTC) Received: by mail-lj1-x22a.google.com with SMTP id 38308e7fff4ca-2afb2874e83so8486121fa.0 for ; Thu, 25 May 2023 09:07:11 -0700 (PDT) DKIM-Signature: v=1; a=rsa-sha256; c=relaxed/relaxed; d=gmail.com; s=20221208; t=1685030829; x=1687622829; h=to:subject:message-id:date:from:in-reply-to:references:mime-version :from:to:cc:subject:date:message-id:reply-to; bh=Y3dJpoSEf25O8mHSnAO3XgHybLUQCqMYFNyu0gw8AQA=; b=Oe6XWv+j1ZOEUdHVR1ggUSbOP5v1bRueE/hEOKbAsbwnf6U94lYqUqtCwDpcMcBTkR ndau2rClB62+IzIgErXNmbOOddbjFhiSCJ2IM4PSYQGap2TRID9llJA8DZ7Xw5mbLq0H H8LayuwFy+mpPTbqBmTdZyBU0GczCzlLBwgDQWDuXONkPG9gW+wYGYbz40crHSBuMw3o kYe9E3Ydo3A1zhI+AtWxC3R9MdYOtUAqPSPZtTSvqGZHZOj6gShCeJ6+q3a1xnnGpsXn MAhhtNczaLv8n1BKaLBuImoRuQ+kOkwnF601E7OLmTzqg62SSt1btLDtr8tN3NSR4eTn MWag== X-Google-DKIM-Signature: v=1; a=rsa-sha256; c=relaxed/relaxed; d=1e100.net; s=20221208; t=1685030829; x=1687622829; h=to:subject:message-id:date:from:in-reply-to:references:mime-version :x-gm-message-state:from:to:cc:subject:date:message-id:reply-to; bh=Y3dJpoSEf25O8mHSnAO3XgHybLUQCqMYFNyu0gw8AQA=; b=eIergTkacQpxONi0FQSgPldrB2BYtM568Qg6bOxbW1gpQwbySI+GReuoYEtZeG9AHz voJGniEN+iN+NIk9qhE3lej6LpSrxYDqmrorjo55Lsn60wXzS/xNQYymR/1O2SXlpsRz Hb3VXZPHWVy9Pc0x7shjhs9TRUbHJTHL6k2EBRSlRKgEaX9QgETdm0o+WmdZpjXeg1rk aO2sfBUJkDVdFcZlCtup11yOO9mZ09/3tdOj7K6cDWzEA93bJ/aa9sjc8PYKYcGwAoh2 0OeAD2ZK2dW5K2hHLSWzF0tPBW3mTVTE4zBDOPH7iMl9eYpYZ7TtXCrBgfN21uLw9YbL 3gvg== X-Gm-Message-State: AC+VfDyoE1UfuPtmxOj0cH24qwn8cqwcJXoG6xHI+z7WImuYyhQ4vgaf /R8oxF8QMuDR3Q3F+d1Tist3o8e+KmjOoQlDU3E9bVOAUFQ= X-Google-Smtp-Source: ACHHUZ467JO2RsWr6qpqo8lqaK84HGkR1/PFx9cC46FXEPOhw7zb/a+n5x+M+OGMH5AANHurJvg5PEWowC/DtoOZjBo= X-Received: by 2002:a05:651c:144:b0:2ad:275a:44b6 with SMTP id c4-20020a05651c014400b002ad275a44b6mr1075695ljd.52.1685030828334; Thu, 25 May 2023 09:07:08 -0700 (PDT) MIME-Version: 1.0 References: In-Reply-To: From: ecurrencyhodler Date: Thu, 25 May 2023 09:06:31 -0700 Message-ID: To: bitcoin-dev@lists.linuxfoundation.org Content-Type: multipart/alternative; boundary="000000000000f5646c05fc86cf30" X-Mailman-Approved-At: Thu, 25 May 2023 17:06:10 +0000 Subject: Re: [bitcoin-dev] bitcoin-dev Digest, Vol 96, Issue 58 X-BeenThere: bitcoin-dev@lists.linuxfoundation.org X-Mailman-Version: 2.1.15 Precedence: list List-Id: Bitcoin Protocol Discussion List-Unsubscribe: , List-Archive: List-Post: List-Help: List-Subscribe: , X-List-Received-Date: Thu, 25 May 2023 16:07:14 -0000 --000000000000f5646c05fc86cf30 Content-Type: text/plain; charset="UTF-8" Content-Transfer-Encoding: quoted-printable Date: Wed, 24 May 2023 From: ecurrencyhodler To: Bitcoin Protocol Discussion Subject: Re: [bitcoin-dev] Ark: An Alternative Privacy-preserving Second Layer Solution (ecurrencyhodler) Thanks David for your write up. Clear, concise, and super understandable as always. It sounds like to me that ARK is using PSBT's + covenants to secure unconfirmed txns. I see how this significantly reduces onchain footprint. But wouldn't this also have a massive impact at scale to the mempool filling it with unconfirmed txns? Couple concerns I have are: 1. It would create an ever growing fee environment within the 10-minute block. Therefore it would be possible for the first settlement txn in th= e first 5 seconds to get pushed out of the mempool by later settlement txn= s closer to the 10 minute mark. 2. Mempools would have to drastically increase their size to capture all the 5-second settlement unconfirmed txns and default bitcoin core nodes would get flooded. Thanks again burak for your ARK proposal. There seems to be a good amount of excitement about what this could unlock in the future which is quite refreshing to see. On Thu, May 25, 2023 at 5:01=E2=80=AFAM < bitcoin-dev-request@lists.linuxfoundation.org> wrote: > Send bitcoin-dev mailing list submissions to > bitcoin-dev@lists.linuxfoundation.org > > To subscribe or unsubscribe via the World Wide Web, visit > https://lists.linuxfoundation.org/mailman/listinfo/bitcoin-dev > or, via email, send a message with subject or body 'help' to > bitcoin-dev-request@lists.linuxfoundation.org > > You can reach the person managing the list at > bitcoin-dev-owner@lists.linuxfoundation.org > > When replying, please edit your Subject line so it is more specific > than "Re: Contents of bitcoin-dev digest..." > > > Today's Topics: > > 1. Re: Ark: An Alternative Privacy-preserving Second Layer > Solution (adiabat) > 2. Re: Ark: An Alternative Privacy-preserving Second Layer > Solution (David A. Harding) > > > ---------------------------------------------------------------------- > > Message: 1 > Date: Wed, 24 May 2023 16:20:35 -0400 > From: adiabat > To: Bitcoin Protocol Discussion > > Subject: Re: [bitcoin-dev] Ark: An Alternative Privacy-preserving > Second Layer Solution > Message-ID: > hfwsxLgwWkUw@mail.gmail.com> > Content-Type: text/plain; charset=3D"UTF-8" > > Hi - thanks for the Ark write up; I have a bunch of questions but here's = 2: > > --- > Q1: > "Pool transactions are created by ark service providers perpetually > every 5 seconds" > > What exactly happens every 5 seconds? From the 15.44.21-p-1080.png > diagram [1], a pool transaction is a bitcoin transaction, with all the > inputs coming from the ASP. My understanding is that every 5 seconds, > we progress from PoolTx(N) to PoolTx(N+1). Does the ASP sign a new > transaction which spends the same ASP funding inputs as the previous > pool transaction, which is a double spend or fee bump? Or does it > spend the outputs from the previous PoolTx? > > In other words, does PoolTx(2) replace PoolTx(1) RBF-style, spending > the same inputs (call this method A), or does PoolTx(2) spend an > output Of Pooltx(1) such that PoolTx(1) must be confirmed in order for > PoolTx(2) to become valid (method B)? Or are they completely separate > transactions with unconflicting inputs (method C)? > > When the ASP creates a pool transaction, what do they do with it? Do > they broadcast it to the gossip network? Or share it with other pool > participants? > > With method A, if the ASP shares pool transactions with other people, > there Doesn't seem to be any way to ensure which PoolTx gets > confirmed, invalidating all the other ones. They're all valid so > whichever gets into a block first wins. > > With method B, there seems to be a large on-chain load, with ~120 > chained transactions trying to get in every block. This wouldn't play > nicely with mempool standardness and doesn't seem like you could ever > "catch up". > > With method C, ASPs would need a pretty large number of inputs but > could recycle them as blocks confirm. It would cost a lot but maybe > could work. > > --- > Q2: > > The other part I'm missing is: what prevents the ASP from taking all > the money? Before even getting to vTXOs and connector outputs, from > the diagram there are only ASP inputs funding the pool transaction. > If the pool transaction is confirmed, the vTXOs are locked in place, > since the vTXO output cannot be changed and commits to all > "constrained outs" via OP_CTV. If the pool transaction is > unconfirmed, the ASP can create & sign a transaction spending all ASP > funding inputs sending the money back to the ASP, or anywhere else. > In this case, users don't have any assurance that their vTXO can ever > turn into a real UTXO; the ASP can "rug-pull" at any time, taking all > the money in the pool. Adding other inputs not controlled by the ASP > to the transaction wouldn't seem to fix the problem, because then any > user removing their inputs would cancel the whole transaction. > > More detail about how these transactions work would be appreciated, thank= s! > > -Tadge > > [1] > https://uploads-ssl.webflow.com/645ae2e299ba34372614141d/6467d1f1bf91e0bf= 2c2eddef_Screen%20Shot%202023-05-19%20at%2015.44.21-p-1080.png > > > ------------------------------ > > Message: 2 > Date: Wed, 24 May 2023 13:02:40 -1000 > From: "David A. Harding" > To: Burak Keceli , Bitcoin Protocol Discussion > > Subject: Re: [bitcoin-dev] Ark: An Alternative Privacy-preserving > Second Layer Solution > Message-ID: <3c6c3b8b562bb56bbb855dc2b2b71f78@dtrt.org> > Content-Type: text/plain; charset=3DUS-ASCII; format=3Dflowed > > Hi Burak, > > Thanks for this really interesting protocol! I tend to analyze > complicated ideas like this by writing about them in my own words, so > I've pasted my summary of your idea to the end of this email in case > it's useful, either to other people or to you in helping understand my > one concern. > > My concern is the same one I think Olaoluwa Osuntokun mentioned on > Twitter[1] and (less clear to me) might be related to ZmnSCPxj's > concern[2]: > > It seems to me that receiving a payment on the protocol, including > conditional payments using HTLC, PTLC, or Anchor-TLC, requires waiting > for the transaction containing that payment to confirm to a sufficient > depth (e.g., I'd wait 6 blocks for small payments and longer for huge > payments). Am I missing something? > > My summary of how I think that part of the protocol works is in the > sections labeled "Make an unconditioned payment" and "Make a conditional > payment" below. In short, it's clear to me how the service provider and > the customer can make instant atomic swaps with each other---they can > either spend instantly cooperatively, or they have to wait for a > timeout. But how can a receiver of funds be assured that they will > actually get those funds unless there's already a timelock and > cooperative spend path placed on those funds? > > -Dave > > Rough initial summary of Ark protocol: > > Alice runs an Ark service provider. Every 5 seconds, she broadcasts a > new unconfirmed onchain transaction that pays three outputs (the > three Cs): > > 1. *Change Output:* money not used for the other two Cs that gets sent > back to the the transaction creator. > > 2. *Connector Output:* an output that will be used in a future > transaction created by Alice as protection against double spends. > > 3. *Commitment Output:* a CTV-style commitment to a set of outputs that > can be published later in a descendant transaction (alternatively, > the commitment output may be spent unilaterally by Alice after 4 > weeks). > > Bob wants to deposit 1 BTC with Alice. He sends her an unsigned PSBT > with an input of his and a change output. She updates the PSBT with a > commitment output that refunds Bob the 1 BTC and a connector output with > some minimum value. They both sign the PBST and it is broadcast. We'll > ignore fees in our examples, both onchain transaction fees and fees paid > to Alice. > > From here, there are several things that Bob can do: > > - *Unilaterally withdraw:* Bob can spend from the commitment output to > put his refund onchain. The refund can only be spent after a 24-hour > time delay, allowing Bob to optionally come to an agreement with Alice > about how to spend the funds before Bob can spend them unilaterally > (as we'll see in a moment). For example, the script might be[3]: > > pk(B) && (older(1 day) || pk(A)) > > - *Collaboratively withdraw:* as seen above, Bob has the ability to come > to a trustless agreement with Alice about how to spend his funds. > They can use that ability to allow Bob to trade his (unpublished) UTXO > for a UTXO that Alice funds and broadcasts. For example: > > - Alice creates an unsigned PSBT that uses as one of its inputs the > connector from Bob's deposit transaction. This will ensure that > any attempt by Bob to double-spend his deposit transaction will > invalidate this withdrawal transaction, preventing Bob from being > able to steal any of Alice's funds. > > Also included in Alice's unsigned PSBT is another connector > output plus the output that pays Bob his 1 BTC. > > - Bob receives Alice's unsigned PSBT and creates a separate PSBT > that includes his unpublished UTXO as an input, giving its value > to Alice in an output. The PSBT also includes as an input the > connector output from Alice's PSBT. This will ensure that any > attempt by Alice to double spend her transaction paying him will > invalidate his transaction paying her. > > - Bob signs his PSBT and gives it to Alice. After verifying it, > Alice signs her PSBT and broadcasts it. > > - *Collaboratively trade commitments:* as mentioned, the commitment > output that pays Bob may be claimed instead by Alice after 4 weeks, so > Bob will need to either withdraw or obtain a new commitment within > that > time. To trade his existing commitment for a new commitment looks > similar to the collaborative withdrawal procedure but without the > creation of an immediately-spendable onchain output: > > - Alice creates an unsigned PSBT that uses as one of its inputs the > connector from Bob's deposit transaction, again preventing double > spending by Bob. Alice also includes a new connector and a new > commitment that again allows Bob to later claim 1 BTC. > > - Bob receives Alice's PSBT and creates a PSBT transferring his > existing commitment to her, with the new connector again being > included as an input to ensure atomicity. > > - Bob signs; Alice signs and broadcasts. > > - *Make an unconditioned payment:* using the mechanisms described above, > it's possible to make either an onchain payment or an offchain > payment---just have Carol receive the new output or commitment rather > than Bob. That payment would have no conditions (except its > atomicity). > > - *Make a conditional payment:* imagine that Carol knows a secret (e.g. > a preimage) that Bob is willing to pay for. > > - Alice creates an unsigned PSBT depending on the connector from > Bob's deposit transaction and creating a new connector. The PSBT > includes an output paying Carol (either onchain or via a > commitment) with an HTLC, allowing Carol to claim the funds if > she > reveals the secret or allowing Bob to claim the funds after a > timeout. > > - Bob receives Alice's PSBT and creates a PSBT transferring his > existing commitment to her with the HTLC condition attached and, > again, with connectors being used to ensure atomicity. > > - Bob signs; Alice signs and broadcasts. > > - Carol can settle her HTLC by either revealing the secret onchain > or by trading her commitment containing the HTLC clause for a > commitment from Alice that doesn't contain the clause (which > Alice will only accept by learning the secret, since Alice has > to settle with Bob). Alice can then either settle onchain or > trade commitments with Bob after giving him the secret. > > - *Do nothing for 4 weeks:* if Bob does nothing for four weeks, Alice > can claim the funds from the commitment output (i.e., takes his > money). > > If Bob did actually do something, and if every other user who also > had an unpublished output in the commitment transaction did > something, then they all exchanged their portion of the funds in > this output to Alice, so Alice can now claim all of those funds > onchain in a highly efficient manner. > > Regarding the connector outputs, although all of the examples above show > Alice directly spending from the connector output in Bob's deposit > transaction, atomicity is also ensured if Alice spends from any output > descended from Bob's connector output. Connector outputs from different > deposits can be used as inputs into the same transaction, merging their > histories. This allows all operations made by Alice to be fully atomic, > ensuring that she doesn't lose any money during a reorg of any length. > > Users are not so well protected during reorgs, e.g. if Bob double-spends > a transaction whose funds were later used in a payment to Carol, then > Carol loses the money. For this reason, Alice will probably want to > prove to users that no funds they receive in a payment derive from any > deposit less than safe_confirmation_depth blocks. > > [1] https://twitter.com/roasbeef/status/1661266771784126464 > > [2] > > https://lists.linuxfoundation.org/pipermail/bitcoin-dev/2023-May/021710.h= tml > > [3] > > https://min.sc/#c=3Dpk%28B%29%20%26%26%20%28older%281%20day%29%20%7C%7C%2= 0pk%28A%29%29 > > > ------------------------------ > > Subject: Digest Footer > > _______________________________________________ > bitcoin-dev mailing list > bitcoin-dev@lists.linuxfoundation.org > https://lists.linuxfoundation.org/mailman/listinfo/bitcoin-dev > > > ------------------------------ > > End of bitcoin-dev Digest, Vol 96, Issue 58 > ******************************************* > --000000000000f5646c05fc86cf30 Content-Type: text/html; charset="UTF-8" Content-Transfer-Encoding: quoted-printable
Date: Wed, 24 May 2023=C2=A0
From: ecurrencyhodler= <ecurrencyhodler@gmail.com<= /a>>
To: Bitcoin Protocol Discussion
=C2=A0 =C2=A0 =C2=A0 =C2=A0 &= lt;bitcoin-dev@lis= ts.linuxfoundation.org>
Subject: Re: [bitcoin-dev] Ark: An Altern= ative Privacy-preserving
=C2=A0 =C2=A0 =C2=A0 =C2=A0 Second =C2=A0Layer = Solution (ecurrencyhodler)

Thanks David for yo= ur write up. Clear, concise, and super understandable as always.
=
It sounds like to me that ARK is using PSBT's=C2=A0+ cov= enants to secure unconfirmed txns.=C2=A0

I see how= this significantly reduces onchain footprint. But wouldn't this also h= ave a massive impact at scale to the mempool filling it with unconfirmed tx= ns? Couple concerns I have are:
  1. It would create an ever g= rowing fee environment within the 10-minute block. Therefore it would be po= ssible for the first settlement txn in the first 5 seconds to get pushed ou= t of the mempool by later settlement txns closer to the 10 minute mark.=C2= =A0
  2. Mempools would have to drastically increase their size to captu= re all the 5-second settlement unconfirmed txns and default bitcoin core no= des would get flooded.
Thanks again burak for your ARK propos= al. There seems to be a good amount of excitement about what this could unl= ock in the future which is quite refreshing to see.

On Thu, May = 25, 2023 at 5:01=E2=80=AFAM <bitcoin-dev-request@lists.linuxfoundation.org>= wrote:
Send bit= coin-dev mailing list submissions to
=C2=A0 =C2=A0 =C2=A0 =C2=A0 bitcoin-dev@lists.linuxfoundation.org

To subscribe or unsubscribe via the World Wide Web, visit
=C2=A0 =C2=A0 =C2=A0 =C2=A0 https://li= sts.linuxfoundation.org/mailman/listinfo/bitcoin-dev
or, via email, send a message with subject or body 'help' to
=C2=A0 =C2=A0 =C2=A0 =C2=A0 bitcoin-dev-request@lists.linuxfoundati= on.org

You can reach the person managing the list at
=C2=A0 =C2=A0 =C2=A0 =C2=A0 bitcoin-dev-owner@lists.linuxfoundation.o= rg

When replying, please edit your Subject line so it is more specific
than "Re: Contents of bitcoin-dev digest..."


Today's Topics:

=C2=A0 =C2=A01. Re: Ark: An Alternative Privacy-preserving Second Layer
=C2=A0 =C2=A0 =C2=A0 Solution (adiabat)
=C2=A0 =C2=A02. Re: Ark: An Alternative Privacy-preserving Second Layer
=C2=A0 =C2=A0 =C2=A0 Solution (David A. Harding)


----------------------------------------------------------------------

Message: 1
Date: Wed, 24 May 2023 16:20:35 -0400
From: adiabat <rx@a= wsomnet.org>
To: Bitcoin Protocol Discussion
=C2=A0 =C2=A0 =C2=A0 =C2=A0 <bitcoin-dev@lists.linuxfoundation.org&g= t;
Subject: Re: [bitcoin-dev] Ark: An Alternative Privacy-preserving
=C2=A0 =C2=A0 =C2=A0 =C2=A0 Second=C2=A0 Layer Solution
Message-ID:
=C2=A0 =C2=A0 =C2=A0 =C2=A0 <CAKEeUhg1qeZOv-Lk8SSTxdkgfSee_E6_4fwNV=3DhfwsxLgwWkUw= @mail.gmail.com>
Content-Type: text/plain; charset=3D"UTF-8"

Hi - thanks for the Ark write up; I have a bunch of questions but here'= s 2:

---
Q1:
"Pool transactions are created by ark service providers perpetually every 5 seconds"

What exactly happens every 5 seconds?=C2=A0 From the 15.44.21-p-1080.png diagram [1], a pool transaction is a bitcoin transaction, with all the
inputs coming from the ASP.=C2=A0 My understanding is that every 5 seconds,=
we progress from PoolTx(N) to PoolTx(N+1).=C2=A0 Does the ASP sign a new transaction which spends the same ASP funding inputs as the previous
pool transaction, which is a double spend or fee bump?=C2=A0 Or does it
spend the outputs from the previous PoolTx?

In other words, does PoolTx(2) replace PoolTx(1) RBF-style, spending
the same inputs (call this method A), or does PoolTx(2) spend an
output Of Pooltx(1) such that PoolTx(1) must be confirmed in order for
PoolTx(2) to become valid (method B)?=C2=A0 Or are they completely separate=
transactions with unconflicting inputs (method C)?

When the ASP creates a pool transaction, what do they do with it?=C2=A0 Do<= br> they broadcast it to the gossip network?=C2=A0 Or share it with other pool<= br> participants?

With method A, if the ASP shares pool transactions with other people,
there Doesn't seem to be any way to ensure which PoolTx gets
confirmed, invalidating all the other ones.=C2=A0 They're all valid so<= br> whichever gets into a block first wins.

With method B, there seems to be a large on-chain load, with ~120
chained transactions trying to get in every block. This wouldn't play nicely with mempool standardness and doesn't seem like you could ever "catch up".

With method C, ASPs would need a pretty large number of inputs but
could recycle them as blocks confirm.=C2=A0 It would cost a lot but maybe could work.

---
Q2:

The other part I'm missing is: what prevents the ASP from taking all the money?=C2=A0 Before even getting to vTXOs and connector outputs, from the diagram there are only ASP inputs funding the pool transaction.
If the pool transaction is confirmed, the vTXOs are locked in place,
since the vTXO output cannot be changed and commits to all
"constrained outs" via OP_CTV.=C2=A0 If the pool transaction is unconfirmed, the ASP can create & sign a transaction spending all ASP funding inputs sending the money back to the ASP, or anywhere else.
In this case, users don't have any assurance that their vTXO can ever turn into a real UTXO; the ASP can "rug-pull" at any time, taking= all
the money in the pool.=C2=A0 Adding other inputs not controlled by the ASP<= br> to the transaction wouldn't seem to fix the problem, because then any user removing their inputs would cancel the whole transaction.

More detail about how these transactions work would be appreciated, thanks!=

-Tadge

[1] https://uploads-ssl.webflow.com/645a= e2e299ba34372614141d/6467d1f1bf91e0bf2c2eddef_Screen%20Shot%202023-05-19%20= at%2015.44.21-p-1080.png


------------------------------

Message: 2
Date: Wed, 24 May 2023 13:02:40 -1000
From: "David A. Harding" <dave@dtrt.org>
To: Burak Keceli <burak@buraks.blog>, Bitcoin Protocol Discussion
=C2=A0 =C2=A0 =C2=A0 =C2=A0 <bitcoin-dev@lists.linuxfoundation.org&g= t;
Subject: Re: [bitcoin-dev] Ark: An Alternative Privacy-preserving
=C2=A0 =C2=A0 =C2=A0 =C2=A0 Second Layer Solution
Message-ID: <3c6c3b8b562bb56bbb855dc2b2b71f78@dtrt.org>
Content-Type: text/plain; charset=3DUS-ASCII; format=3Dflowed

Hi Burak,

Thanks for this really interesting protocol!=C2=A0 I tend to analyze
complicated ideas like this by writing about them in my own words, so
I've pasted my summary of your idea to the end of this email in case it's useful, either to other people or to you in helping understand my<= br> one concern.

My concern is the same one I think Olaoluwa Osuntokun mentioned on
Twitter[1] and (less clear to me) might be related to ZmnSCPxj's
concern[2]:

It seems to me that receiving a payment on the protocol, including
conditional payments using HTLC, PTLC, or Anchor-TLC, requires waiting
for the transaction containing that payment to confirm to a sufficient
depth (e.g., I'd wait 6 blocks for small payments and longer for huge payments).=C2=A0 Am I missing something?

My summary of how I think that part of the protocol works is in the
sections labeled "Make an unconditioned payment" and "Make a= conditional
payment" below.=C2=A0 In short, it's clear to me how the service p= rovider and
the customer can make instant atomic swaps with each other---they can
either spend instantly cooperatively, or they have to wait for a
timeout.=C2=A0 But how can a receiver of funds be assured that they will actually get those funds unless there's already a timelock and
cooperative spend path placed on those funds?

-Dave

Rough initial summary of Ark protocol:

Alice runs an Ark service provider.=C2=A0 Every 5 seconds, she broadcasts a=
new unconfirmed onchain transaction that pays three outputs (the
three Cs):

1. *Change Output:* money not used for the other two Cs that gets sent
=C2=A0 =C2=A0 back to the the transaction creator.

2. *Connector Output:* an output that will be used in a future
=C2=A0 =C2=A0 transaction created by Alice as protection against double spe= nds.

3. *Commitment Output:* a CTV-style commitment to a set of outputs that
=C2=A0 =C2=A0 can be published later in a descendant transaction (alternati= vely,
=C2=A0 =C2=A0 the commitment output may be spent unilaterally by Alice afte= r 4
=C2=A0 =C2=A0 weeks).

Bob wants to deposit 1 BTC with Alice.=C2=A0 He sends her an unsigned PSBT<= br> with an input of his and a change output.=C2=A0 She updates the PSBT with a=
commitment output that refunds Bob the 1 BTC and a connector output with some minimum value.=C2=A0 They both sign the PBST and it is broadcast.=C2= =A0 We'll
ignore fees in our examples, both onchain transaction fees and fees paid to Alice.

=C2=A0From here, there are several things that Bob can do:

- *Unilaterally withdraw:* Bob can spend from the commitment output to
=C2=A0 =C2=A0put his refund onchain.=C2=A0 The refund can only be spent aft= er a 24-hour
=C2=A0 =C2=A0time delay, allowing Bob to optionally come to an agreement wi= th Alice
=C2=A0 =C2=A0about how to spend the funds before Bob can spend them unilate= rally
=C2=A0 =C2=A0(as we'll see in a moment).=C2=A0 For example, the script = might be[3]:

=C2=A0 =C2=A0 =C2=A0pk(B) && (older(1 day) || pk(A))

- *Collaboratively withdraw:* as seen above, Bob has the ability to come =C2=A0 =C2=A0to a trustless agreement with Alice about how to spend his fun= ds.
=C2=A0 =C2=A0They can use that ability to allow Bob to trade his (unpublish= ed) UTXO
=C2=A0 =C2=A0for a UTXO that Alice funds and broadcasts.=C2=A0 For example:=

=C2=A0 =C2=A0 =C2=A0- Alice creates an unsigned PSBT that uses as one of it= s inputs the
=C2=A0 =C2=A0 =C2=A0 =C2=A0connector from Bob's deposit transaction.=C2= =A0 This will ensure that
=C2=A0 =C2=A0 =C2=A0 =C2=A0any attempt by Bob to double-spend his deposit t= ransaction will
=C2=A0 =C2=A0 =C2=A0 =C2=A0invalidate this withdrawal transaction, preventi= ng Bob from being
=C2=A0 =C2=A0 =C2=A0 =C2=A0able to steal any of Alice's funds.

=C2=A0 =C2=A0 =C2=A0 =C2=A0 =C2=A0Also included in Alice's unsigned PSB= T is another connector
=C2=A0 =C2=A0 =C2=A0 =C2=A0 =C2=A0output plus the output that pays Bob his = 1 BTC.

=C2=A0 =C2=A0 =C2=A0- Bob receives Alice's unsigned PSBT and creates a = separate PSBT
=C2=A0 =C2=A0 =C2=A0 =C2=A0that includes his unpublished UTXO as an input, = giving its value
=C2=A0 =C2=A0 =C2=A0 =C2=A0to Alice in an output.=C2=A0 The PSBT also inclu= des as an input the
=C2=A0 =C2=A0 =C2=A0 =C2=A0connector output from Alice's PSBT.=C2=A0 Th= is will ensure that any
=C2=A0 =C2=A0 =C2=A0 =C2=A0attempt by Alice to double spend her transaction= paying him will
=C2=A0 =C2=A0 =C2=A0 =C2=A0invalidate his transaction paying her.

=C2=A0 =C2=A0 =C2=A0- Bob signs his PSBT and gives it to Alice.=C2=A0 After= verifying it,
=C2=A0 =C2=A0 =C2=A0 =C2=A0Alice signs her PSBT and broadcasts it.

- *Collaboratively trade commitments:* as mentioned, the commitment
=C2=A0 =C2=A0output that pays Bob may be claimed instead by Alice after 4 w= eeks, so
=C2=A0 =C2=A0Bob will need to either withdraw or obtain a new commitment wi= thin
that
=C2=A0 =C2=A0time.=C2=A0 To trade his existing commitment for a new commitm= ent looks
=C2=A0 =C2=A0similar to the collaborative withdrawal procedure but without = the
=C2=A0 =C2=A0creation of an immediately-spendable onchain output:

=C2=A0 =C2=A0 =C2=A0- Alice creates an unsigned PSBT that uses as one of it= s inputs the
=C2=A0 =C2=A0 =C2=A0 =C2=A0connector from Bob's deposit transaction, ag= ain preventing double
=C2=A0 =C2=A0 =C2=A0 =C2=A0spending by Bob.=C2=A0 Alice also includes a new= connector and a new
=C2=A0 =C2=A0 =C2=A0 =C2=A0commitment that again allows Bob to later claim = 1 BTC.

=C2=A0 =C2=A0 =C2=A0- Bob receives Alice's PSBT and creates a PSBT tran= sferring his
=C2=A0 =C2=A0 =C2=A0 =C2=A0existing commitment to her, with the new connect= or again being
=C2=A0 =C2=A0 =C2=A0 =C2=A0included as an input to ensure atomicity.

=C2=A0 =C2=A0 =C2=A0- Bob signs; Alice signs and broadcasts.

- *Make an unconditioned payment:* using the mechanisms described above, =C2=A0 =C2=A0it's possible to make either an onchain payment or an offc= hain
=C2=A0 =C2=A0payment---just have Carol receive the new output or commitment= rather
=C2=A0 =C2=A0than Bob.=C2=A0 That payment would have no conditions (except = its
=C2=A0 =C2=A0atomicity).

- *Make a conditional payment:* imagine that Carol knows a secret (e.g.
=C2=A0 =C2=A0a preimage) that Bob is willing to pay for.

=C2=A0 =C2=A0 =C2=A0 - Alice creates an unsigned PSBT depending on the conn= ector from
=C2=A0 =C2=A0 =C2=A0 =C2=A0 Bob's deposit transaction and creating a ne= w connector.=C2=A0 The PSBT
=C2=A0 =C2=A0 =C2=A0 =C2=A0 includes an output paying Carol (either onchain= or via a
=C2=A0 =C2=A0 =C2=A0 =C2=A0 commitment) with an HTLC, allowing Carol to cla= im the funds if
she
=C2=A0 =C2=A0 =C2=A0 =C2=A0 reveals the secret or allowing Bob to claim the= funds after a
=C2=A0 =C2=A0 =C2=A0 =C2=A0 timeout.

=C2=A0 =C2=A0 =C2=A0 - Bob receives Alice's PSBT and creates a PSBT tra= nsferring his
=C2=A0 =C2=A0 =C2=A0 =C2=A0 existing commitment to her with the HTLC condit= ion attached and,
=C2=A0 =C2=A0 =C2=A0 =C2=A0 again, with connectors being used to ensure ato= micity.

=C2=A0 =C2=A0 =C2=A0 - Bob signs; Alice signs and broadcasts.

=C2=A0 =C2=A0 =C2=A0 - Carol can settle her HTLC by either revealing the se= cret onchain
=C2=A0 =C2=A0 =C2=A0 =C2=A0 or by trading her commitment containing the HTL= C clause for a
=C2=A0 =C2=A0 =C2=A0 =C2=A0 commitment from Alice that doesn't contain = the clause (which
=C2=A0 =C2=A0 =C2=A0 =C2=A0 Alice will only accept by learning the secret, = since Alice has
=C2=A0 =C2=A0 =C2=A0 =C2=A0 to settle with Bob).=C2=A0 Alice can then eithe= r settle onchain or
=C2=A0 =C2=A0 =C2=A0 =C2=A0 trade commitments with Bob after giving him the= secret.

- *Do nothing for 4 weeks:* if Bob does nothing for four weeks, Alice
=C2=A0 =C2=A0can claim the funds from the commitment output (i.e., takes hi= s
=C2=A0 =C2=A0money).

=C2=A0 =C2=A0 =C2=A0If Bob did actually do something, and if every other us= er who also
=C2=A0 =C2=A0 =C2=A0had an unpublished output in the commitment transaction= did
=C2=A0 =C2=A0 =C2=A0something, then they all exchanged their portion of the= funds in
=C2=A0 =C2=A0 =C2=A0this output to Alice, so Alice can now claim all of tho= se funds
=C2=A0 =C2=A0 =C2=A0onchain in a highly efficient manner.

Regarding the connector outputs, although all of the examples above show Alice directly spending from the connector output in Bob's deposit
transaction, atomicity is also ensured if Alice spends from any output
descended from Bob's connector output.=C2=A0 Connector outputs from dif= ferent
deposits can be used as inputs into the same transaction, merging their
histories.=C2=A0 This allows all operations made by Alice to be fully atomi= c,
ensuring that she doesn't lose any money during a reorg of any length.<= br>
Users are not so well protected during reorgs, e.g. if Bob double-spends a transaction whose funds were later used in a payment to Carol, then
Carol loses the money.=C2=A0 For this reason, Alice will probably want to prove to users that no funds they receive in a payment derive from any
deposit less than safe_confirmation_depth blocks.

[1] https://twitter.com/roasbeef/status/16612= 66771784126464

[2]
https://lists.linuxfound= ation.org/pipermail/bitcoin-dev/2023-May/021710.html

[3]
https://min.sc= /#c=3Dpk%28B%29%20%26%26%20%28older%281%20day%29%20%7C%7C%20pk%28A%29%29


------------------------------

Subject: Digest Footer

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= bitcoin-dev@lists.linuxfoundation.org
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------------------------------

End of bitcoin-dev Digest, Vol 96, Issue 58
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