Author: Goss, Brian C., M.D. 2014-06-17 20:40:50
Published on: 2014-06-17T20:40:50+00:00
The email conversation is about establishing trust in the identity associated with an ECC key pair. Fidelity bonds or Trusted Identities can be used to establish trust. Alice, who has bitcoins held at bitcoin address A, wants to establish trust in the identity associated with the ECC keypair associated with A, for instance for the purpose of having other users trust her not to attempt to double spend. Since the trust she seeks is financial in nature, she can do this by valuing the identity associated with A, by deliberately throwing away resources. A simple way to do this would be to transfer coins to a null address, provably incurring a cost to her. A more socially responsible way would be for her to create a series of transactions that happen to have large and equal transaction fees. Bitcoin makes the assumption that no one entity controls more than 50% of the network, so if she makes n of these transactions consecutively, each spending m BTC to transaction fees, there is a high probability that she has given up at least n/2 * m BTC of value. This increases the transaction fees for miners, which will be very important for the network in the future. Bob can easily examine the blockchain, and upon verifying Alice's trust purchase, can decide to accept a zero-confirmation transaction at face value. If Alice breaks that promise, he simply publishes her signed transaction proving that Alice is a fraudster, and future Bob's will distrust Alice's trusted identity, thus destroying the value needed to create it. In effect, we now have a distributed green address system. It is noted that the second paragraph is seriously obsolete, better to either use announce-commit sacrifices or much preferably simple destruction of coins. Sacrifice to fees encourages mining centralization for obvious reasons.
Updated on: 2023-06-09T00:11:43.505887+00:00