Author: Clara Shikhelman 2022-11-25 15:40:11
Published on: 2022-11-25T15:40:11+00:00
Antoine Riard proposes a new "staking"/reputational credentials policy to save on unconditional fees paid by HTLC senders. He explains that routing nodes can maintain a 0-risk HTLC forwarding acceptance by requesting strict binding between the acquisition cost of credentials and channel liquidity routed. Higher returns can be achieved with an adjusted ratio of credentials to liquidity, but this comes with higher risks. Riard suggests that a "pure reputation" system can also be layered on top of this monetary paradigm to allocate more significant liquidity slots based on the quality of identities (e.g proof-of-utxo-ownership). However, proving UTXO ownership without revealing any other information is a bottleneck in this system. Clara Shikhelman questions whether there is a clear benefit to using a token compared to unconditional fees and local reputation. She suggests that a recommended policy is needed to guide the set of algorithms that should determine the token quantity, rate issuance, token acquisition cost, and adaptations in function of local channel congestion, and gossip from other routing nodes. Riard agrees that a recommended policy is needed and proposes refining the proposed credentials architectural framework. A timeline for presenting such a policy is not yet established.
Updated on: 2023-06-03T10:49:10.739662+00:00