Author: Matthew Roberts 2016-08-07 05:35:49
Published on: 2016-08-07T05:35:49+00:00
The author proposes a protection mechanism that would be applied to the hot wallet coins. The output script of the hot wallet would only allow coins to be sent to a new transaction whose output script could only be redeemed after N confirmations, but can also be recovered to a fixed fail-safe address before the time-lock is reached. Deposits to the hot wallet would need to be encumbered by the same protection so that the time-lock to redeem coins can be applied to every new transaction trying to move coins. This approach is good for crucial services like wallets, gambling websites, e-commerce websites, provable dead man's switches on the protocol level, and obviously exchange hot (and cold) wallets. Wallets could be built that grouped coins into different "accounts" with different time-frames required for clearing / unlocking coins. Gambling websites that process a lot of Bitcoins also have a hot wallet which could be better protected by this. The linked page describes that merchants will never accept payments from 'vaults', and it will take 24 hours for coins to be irreversible moved outside the 'vault'. The author argues that all of this needs to take place on the blockchain with a new set of OP_CODES and other than the fixed address issue with OP_SPENDTO. The key difference from a regular transaction is that the destination only has access to the coins -after- the relative time-lock is reached (N blocks after first confirm) so everyone knows where withdrawals are supposed to be going and how many coins are being withdrawn at any given time.
Updated on: 2023-06-11T19:18:41.326409+00:00