Published on: 2011-12-09T09:50:03+00:00
In a conversation between Stefan Thomas and Dr. Andy Parkins, they discussed the issue of Bitcoin transactions being reversed based on outputs. They also talked about the problems with hosted wallets that rely on services, using the MyBitcoin debacle as an example. Hosted wallets were suggested to use separate public keys for each account to mitigate risk, but Dr. Parkins raised concerns about the traceability of addresses. In an email exchange, Dr. Parkins proposed a new idea for Bitcoin transactions. He suggested that when a transaction is broadcasted, it should include the hash of the block it wants to appear after, which he called the "basis block". This would allow miners to add a condition where any transactions outputting new transactions must appear before the new transaction's basis block. The purpose of this change is to prevent scenarios where a withdrawal from a pooled-account online wallet appears in different blocks, causing inconveniences for honest users. Stefan mentioned that hosted wallets can use bitcoin inputs from personal deposits as outputs for withdrawals, but this method has security concerns. He argued that keeping each account as separate public keys would provide better risk isolation and enable instant deposits. While the proposal was considered thought-provoking, it seems that the implementation of this specific idea has not been widely adopted in the cryptocurrency world. However, Dr. Parkins' idea of including the basis block when broadcasting a transaction could potentially eliminate the possibility of attackers arranging reorganizations and causing loss. It would ensure that transactions based on specific blocks would never make it into subsequent blocks. Dr. Parkins explained this concept using an example involving transferring coins from address A to Mt.Gox in block 2 and transferring credit from address A to address B in block 1. With the proposed change, if a chain at block 3 becomes dominant over block 5, a withdrawal made by Mt.Gox in block 3 cannot make it into block 4 because it is based on block 2. This change would be optional and implied by input transactions if not explicitly stated, and it would only need to be stored for pending transactions without requiring changes to the block format.Although the example of Mt.Gox may not be ideal due to their fiat-related issues, this change could benefit other online wallet accounts by allowing faster acceptance of received funds without the risk of loss. Overall, while Dr. Parkins' idea has not seen widespread adoption, it presents an interesting solution to address the challenges associated with Bitcoin transactions.
Updated on: 2023-08-01T02:42:05.874947+00:00