Published on: 2014-03-02T19:03:06+00:00
Troy Benjegerdes requested a clear design document for developing code for trading between two blockchains. The conversation then shifted towards the importance of accurate historic market data in buying and selling commodities. Some argued that trade is the primary goal of markets, while others emphasized the significance of accurate historic data for traders. Despite the debates, Benjegerdes reiterated his request for working code for cross-chain trades and suggested addressing the historic data problem later.The discussion also touched upon the vulnerability of a Bitmessage-like network to front-running through a sybil attack. It was pointed out that marketplaces face challenges because the data they publish must be public, making them susceptible to attacks. The primary goal of markets was asserted to be trade itself rather than price discovery. While the accuracy of historic data may not be crucial, as long as personal trade data is correct and auditable, buyers and sellers can still exchange goods at a good price. In another email conversation, Peter Todd discussed the possibility of a hard fork to enable marketplaces. He expressed support for testing out the functionality of marketplaces through one-sided trade before considering any forks. Todd disagreed with the argument that a Bitmessage-like network would be easily front-run through a sybil attack. He emphasized that the primary goal of markets is trade, not price discovery. Todd also discussed the importance of accurate historic market data and proposed methods to ensure honesty in records.The context included discussions on cross-chain trading, the limitations of hard forks, and the importance of accurate historic market data. Various viewpoints were presented regarding the role of markets, the vulnerability of networks to attacks, and the need for working code for cross-chain trades. The conversations involved multiple participants who shared their perspectives on these topics.In the given context, a two-step trade mechanism is described that allows for trust-free and atomic transactions. The mechanism involves Alice creating a partial transaction with an input she controls and an output that she controls as well. She gives this partial transaction to Bob, who completes it by providing one or more inputs with a sum value of at least 1BTC and an output for the colored coins to be directed to. Bob signs his inputs with SIGHASH_ALL and broadcasts the transaction, completing the trade.This two-step trade mechanism can also be used to create a decentralized marketplace. Proof-of-publication offers a solution in this case by allowing Alice to embed her incomplete transaction as data in a second, valid transaction. Bidders like Bob can then scan the blockchain for offers with acceptable prices, and unfilled offers at any given block height provide honest information about the market historically.It is mentioned that any embedded consensus system can make use of this two-step trade mechanism as long as it is possible to create transactions where spending a single transaction output moves an asset appropriately. However, extending this mechanism to situations where more than one input needs to be spent or more than one output needs to be created is difficult.An alternative approach could be to create a mechanism where some embedded data signifies the creation of a temporary transfer txout. Spending that txout would then atomically bring about the desired change in the consensus state. This alternative approach would overcome the limitations of the current mechanism when dealing with multiple inputs or outputs.
Updated on: 2023-08-01T07:35:38.591290+00:00