Published on: 2022-05-21T21:36:06+00:00
Paragraph 1:The discussion revolves around the concept of fidelity bonds and their use in proving non-dilutability. It is pointed out that the analogy of borrowing gold to make an advertisement and then returning it with interest is not entirely accurate because the same gold atoms cannot be reused in two different advertisements. The suggestion is made to use domain separation tags to ensure fidelity bonds are only used in specific applications, but this relies on social consensus and a clear definition of each application.Paragraph 2:The conversation also explores the idea of using someone else's proof of burn (PoB) to prove an expense. This involves renting someone else's PoB to demonstrate necessary expenses. The defiads scheme utilizes this concept by selling an advertisement created by the covenant and its presumed exclusivity. Paragraph 3:The concept of lending and borrowing scenarios is discussed, where the lender provides the principal amount and is paid interest in exchange, while the borrower uses the principal to generate income. However, if the principal is used as a billboard for an advertisement, it is not being used as money. Instead, a fidelity bond is used to back an assertion of trustworthiness. The term "fidelity bond" is accepted, but it is acknowledged that it is a misleading analogy since proof of burn/work is merely a demonstration of a prior expense.Paragraph 4:In an email exchange, ZmnSCPxj raises privacy concerns regarding linking two identities: JoinMarket maker and Teleport maker. While acknowledging that linking the identities can slightly degrade privacy, it is argued that this must be balanced against the risk of sybil attacks on both systems. Without fidelity bonds, both systems are vulnerable to such attacks, which could result in lost coins.Paragraph 5:The discussion between Chris Belcher and ZmnSCPxj focuses on the use of fidelity bonds in JoinMarket and Teleport. Chris explains that fidelity bond owners can use them in multiple applications, increasing their left-hand-side value while the right-hand-side value remains constant. However, he acknowledges that if two makers in the same application use the same fidelity bond, it could be problematic. Privacy concerns are also addressed, with Chris mentioning the implementation of podle commitments in JoinMarket to combat malicious takers aborting at the last step.Paragraph 6:The conversation between two individuals delves into the concept of renting out fidelity bonds to generate yield. The net present value of a loan is questioned, and an alternative scenario where a landlord pays a lessor rent in exchange for use of the fidelity bond coin is proposed. Risks associated with rental services, such as surveillance and privacy concerns, are discussed. Potential solutions, including removing the intermediate certificate keypair and using pay-for-signature protocols, are suggested.Paragraph 7:The conversation explores the potential market of lessors and the risks associated with rental services. The defiads project is mentioned as an example of a system prioritizing advertisements with larger bonded values. The use of pay-for-signature protocols is proposed to address privacy concerns. The discussion also touches on checking fidelity bonds not being used across multiple makers and whether this deserves a section in the BIP.Paragraph 8:The email exchange between Chris Belcher and ZmnSCPxj addresses the use of the same fidelity bond in both JoinMarket and Teleport. Chris believes it is an intended feature and can be used across different applications without being abusable. However, he acknowledges the potential problem if two makers in the same application use the same fidelity bond. The question of potential abuse is raised.Paragraph 9:The BIP proposes a method for storing timelocked address fidelity bonds in BIP39 phrases and signing fidelity bond certificates. It defines a common derivation scheme for users of wallet software to have a backup of their fidelity bonds. The BIP mainly documents an existing system and provides test vectors and examples of timelocked addresses.Overall, the conversation explores various aspects of fidelity bonds, including their use in proving non-dilutability, lending and borrowing scenarios, privacy concerns, rental services, and the proposed BIP for storing and signing fidelity bond certificates.
Updated on: 2023-08-02T06:21:58.705963+00:00