Author: Greg Sanders 2022-12-08 20:28:11
Published on: 2022-12-08T20:28:11+00:00
The eltoo protocol has been a topic of discussion among developers looking to improve Bitcoin's Lightning Network. It introduces a cryptographic puzzle that limits the publication of eltoo states more than once by a counterparty, simplifying the process when only one party's opinion matters. However, vulnerabilities such as a higher-feerate transaction attack and watchtower collusion still exist. Proposed solutions involve penalties on top of symmetric states and trustless watchtowers. The introduction of watchtower-specific transactions may also pose problems.The eltoo IRC channel has discussed optimizing eltoo for the two-party scenario, allowing for simplification of several things. However, there are practical constraints to consider, including extending it to multiparty channels, adding fees, and paying watchtowers. Coordinating multiparty state updates and conserving the fast-forward effect is difficult, and payments at the multiparty level may only be necessary for privacy or liquidity allocation reasons.The Lightning Network development team has proposed a new approach for dealing with issues related to double delays, penalties, and trustless watchtowers for two-party channels. Each participant maintains five transactions to handle unilateral closes. However, this approach does not address potential issues related to adding fees, paying watchtowers, lack of layered transactions, and extending to other payment channels.When it comes to penalizing multiple parties in multiparty channels, the process becomes difficult. Fast forwards are also challenging as multiple round trips are needed to coordinate signatures. Reducing n-party channels to an easier-to-update 2-party channel requires channels within channels and a to_self_delay for each layer. Furthermore, coordinating multiparty state updates and ensuring that all participants stay online consistently to generate new signatures adds another layer of complexity to the process. These issues were discussed in a Lightning-dev mailing list.
Updated on: 2023-06-03T11:08:17.957400+00:00