Author: Nadav Kohen 2020-04-03 16:37:15
Published on: 2020-04-03T16:37:15+00:00
The email thread discusses the concerns with the Statechain Entity (SE) and the possibility of untraceably scamming its users. The attack involves buying UTXO, transferring it to someone else, and stealing it back using the SE's shard s_n and full private key x. The user who had their funds stolen cannot prove that this has happened since the attack compromises their key. However, this problem can be fixed by adding a new user key to the protocol that must be signed for the transfer to be considered valid on the state chain. This way, if the SE wishes to steal the funds, at least it is traceable/provable that the SE is not trustworthy as there is no evidence of a valid transfer for the funds that have been stolen. Tom Trevethan via bitcoin-dev thanks everyone for their input and comments and decides that the decrementing nSequence relative locktime backup system with kick-off transaction is the best option, including a fee penalty via CPFP to disincentivize DoS. He also provides a more detailed document specifying the proposed protocol in more detail that includes improvements to the transfer mechanism and an explanation of how this can be used to transfer/novate positions in DLCs. Tom encourages feedback or PRs. David A. Harding raises concerns about Tom’s proposal to use statechains with 2P-ECDSA and its relation to his patent assigned to nChain Holdings for "Secure off-chain blockchain transactions." The patent application describes an exchange platform that is trusted to implement and operate the transaction protocol without requiring an on-chain transaction. The off-chain transactions enable one computer system to generate multiple transactions that are recordable to a blockchain in different circumstances. They are also valid for recording on the blockchain even in the event of a catastrophic failure of the exchange. The patent application has not been granted yet, but Tom clarifies that although he worked at nChain two years ago, the current ideas are significantly different from those in the application.
Updated on: 2023-06-14T00:19:38.602899+00:00