RBF Pinning with Counterparties and Competing Interest



Summary:

The Lightning protocol faces a severe issue where a counterparty can spend an HTLC using the preimage with a low-fee, RBF-disabled transaction if the commitment transaction is broadcasted. ZmnSCPxj suggests adding an RBF carve-out output to HTLC-Timeout, which allows B to exponentially increase the fee as L+1 approaches. With this, B can prevent C from stealing the HTLC value since the UTXO it could steal from has already been spent. The additional output bloats the UTXO set, but Decker-Russell-Osuntokun sidesteps this issue as any timed-out HTLC can be claimed with a fee-bumpable transaction directly without RBF-carve-out. It seems possible to upgrade a Poon-Dryja channel to a Decker-Russell-Osuntokun channel without on-chain activity. If a relay path exists to a miner running full RBF, then B's higher fee rate spend will win over. However, if the malicious node uses a non-RBF signalled transaction to sweep their HTLC, then we enter into another level of race, but this time on the mempool propagation level.


Updated on: 2023-05-20T22:08:00.451236+00:00