Author: Tier Nolan 2014-01-03 18:16:43
Published on: 2014-01-03T18:16:43+00:00
A proposed payment scheme that uses key derivation has been suggested by Nadav Ivgi. In this scheme, the payer generates a random "receipt number" and derives an address from the payee's master public key using this number. The payer then pays to this address and sends the receipt to the payee who derives a private key with it and adds it to their wallet. This process increases privacy by avoiding address reuse and is asynchronous, meaning no payment server is required. Additionally, this scheme can be used as a replacement for cases where re-used addresses are the most viable solution. The receipt also acts as proof of payment that the payer can provide to the payee, and if the master is known to belong to someone, the payer can prove to a third-party that the payment was made to that person. However, losing the receipt numbers means losing access to funds, and there is no way to restore them. Furthermore, the scheme requires sending the receipt to the payee somehow, and email could work for that, but a better-defined channel that can talk to the Bitcoin client and add the receipt would be much better. It is worth noting that the random number that the buyer uses could be generated from a root key as well, allowing them to regenerate all random numbers they used and recreate their receipts. However, the master root would have to be stored on the computer. The payment protocol is supposed to do something like this already, though.
Updated on: 2023-06-07T23:26:00.975032+00:00