Author: Antoine Riard 2022-12-02 00:33:20
Published on: 2022-12-02T00:33:20+00:00
The use of credential tokens in Lightning Network prevents DoS attacks by allowing only one-time creation of a single HTLC. Routing hops cannot use the credentials tokens to assign blame, and the prevention of jamming attacks relies on misbehaving senders exhausting their supply of scarce and costly tokens. Delegation can still occur through naive blinding, where Bob shares Ned's tokens with Mallory, who can consume them to waste Ned routing liquidity. However, Bob should bear the acquisition cost. Trampoline flow can be used for delegation, where Bob attaches his Ned tokens to Alice's HTLC, which shouldn't leak the delegation fact itself to the routing hops.Economic relationships between LSPs and their clients make token harvesting at the LSP-level possible. The over-supply of tokens can be resold to the LSP in exchange for other advantages such as discount on JIT channels. This over-supply can be assigned to newer clients devoid of credentials tokens if there is still a costly bound enforced by the LSP to avoid a jamming adversary exploiting the cost asymmetry. A reasonable routing policy will be to reward HTLC on "favorable" incoming links, but this creates asymmetry if the incoming link operator allows free credential tokens earned by its clients.Jamming vectors opened by an adversary having collected a large stock of tokens should not affect the routing hops economically, as long as there is strict equality between the credentials acquisition cost and the routing fees. Wasting liquidity worth 1000 sats of routing fees should have been compensated by credentials worth 1000 sats, and the routing hops still earn income. Staking/reputational credentials pour the original HTLC forwarding risk on the sender, while making this risk fine-grained and flexible in its allocation. Routing fees would vary depending on multiple factors, while the credentials token acquisition cost should stay identical to avoid offering exploitable asymmetries to an attacker. The argument that jamming would be solved as the attacker has to sacrifice opportunity costs of its liquidity is not entirely true, as attackers can tie up liquidity for many links and have higher return rates than attacker liquidity due to routing algorithms historical data. The damage inflicted might be merchant goods themselves far beyond the attacker opportunity costs, and the opportunity cost between attacker and victims might not be symmetric because the attacker has large liquidity reserves.Mallory can run multiple nodes and buy a small number of tokens initially, then send payments back and forth ensuring success, receiving back >100% tokens used. This gives Mallory a large number of tokens, which can be used to launch a wide attack on the network by trading off reputation for whatever they might gain by attacking the LN. Forwarding nodes must charge a large fee on successful resolution of payments, such that the >100% return on tokens is equal to the cost of buying the extra tokens fresh, to prevent such attacks. Token harvesting at the LSP-level allows clients to avoid paying for credential tokens, equivalent to free upfront fees. LSPs can prevent a client from using too many tokens and require the client pay other inescapable costs to avoid competitors draining the token capital of an LSP without losing a substantial amount of its own money. Jamming attackers can impose costs on others by also losing a substantial amount, meaning the original problem was already solved by its structure.
Updated on: 2023-06-03T10:38:19.369760+00:00