This week’s brings two papers from the same team on the topic of preventing delay abuse within lightning p2p exchanges:
A trusted latency monitor service, for preventing abuse in a Lightning-based peer-to-peer exchange. link
Preventing transaction delays with a Lightning routing service, for preventing abuse in a Lightning-based peer-to-peer exchange. link
This week’s paper is Blockstream proposed solution for scaling lighthning by enabling trust-less off-blockchain channel funding.
The Bitcoin network has scalability problems. To increase its transaction rate and speed, micropayment channel networks have been proposed, however these require to lock funds into specific channels. Moreover, the available space in the blockchain does not allow scaling to a world wide payment system. We propose a new layer that sits in between the blockchain and the payment channels. The new layer addresses the scalability problem by enabling trust-less off-blockchain channel funding.
This was published alongside the new Eltoo lightning update mechanism by blockstream.
From the abstract:
Bitcoin, and other blockchain based systems, are inherently limited in their scalability. On-chain payments must be verified and stored by every node in the network, meaning that the node with the least re- sources limits the overall throughput of the system as a whole. Layer 2, also called off-chain protocols, are often seen as the solution to these scalability issues: by renegotiating a shared state among a limited set of participants, and not broadcasting the vast majority of state up- dates to the blockchain, the load on the network is reduced. Central to all Layer 2 protocols is the issue of guaranteeing that an old state may not be committed once it has been replaced. In this work we present eltoo, a simple, yet powerful replacement mechanism for Layer 2 protocols. It introduces the idea of state numbers, an on-chain en- forceable variant of sequence numbers that were already present in the original implementation, but that were not enforceable.
This week’s paper pick, published by Del Rajan and Matt Visser from Victoria University of Wellington on April 17, 2018, is a conceptual design for a quantum blockchain.
A conceptual design for a quantum blockchain is proposed. Our method involves encoding the blockchain into a temporal GHZ (Greenberger–Horne–Zeilinger) state of photons that do not simul- taneously coexist. It is shown that the entanglement in time, as opposed to an entanglement in space, provides the crucial quantum advantage. All the subcomponents of this system have already been shown to be experimentally realized. Perhaps more shockingly, our encoding procedure can be interpreted as non-classically influencing the past; hence this decentralized quantum blockchain can be viewed as a quantum networked time machine.
This is the first brief in a new series called Paper Pick that will occasionally allow our readers to discover published papers related to Bitcoin technology.
This week’s paper pick, published on Oct 26, 2015, is a privacy-preserving proof of solvency for bitcoin exchanges that does not disclose the exchange’s Bitcoin address, its total holdings or liabilities, or any information about its customers.
Bitcoin exchanges function like banks, securely holding their customers’ bitcoins on their behalf. Several exchanges have suffered catastrophic losses with customers permanently losing their savings. A proof of solvency demonstrates that the exchange controls sufficient reserves to settle each customer’s account. We introduce Provisions , a privacy-preserving proof of solvency whereby an exchange does not have to disclose its Bitcoin addresses; total holdings or liabilities; or any information about its cus- tomers. We also propose an extension which prevents exchanges from colluding to cover for each other’s losses. We have implemented Provisions and show that it offers practical computation times and proof sizes even for a large Bitcoin exchange with millions of customers.
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Monero is one of the leading privacy coins on the market. A recent paper called An Empirical Analysis of Traceability in the Monero Blockchain argued that it might not be as private as expected.
In this paper, we empirically evaluate two weaknesses in Monero’s mixin sampling strategy. First, about 62% of transaction inputs with one or more mixins are vulnerable to “chain-reaction” analysis — that is, the real input can be deduced by elimination. Second, Monero mixins are sampled in such a way that they can be easily distinguished from the real coins by their age distribution; in short, the real input is usually the “newest” input.
However some of the issues addressed in the paper have already been addressed by the monero dev team.
Greg Slepak posted a link to a paper called the DCS Theorem. It’s a probability proof of the DCS Triangle showing that decentralized consensus systems can have Decentralization, Consensus, or Scale, but not all three simultaneously.
He said on bitcoin-dev said:
The DCS Triangle was independently discovered by myself and Trent McConaghy.
It is a useful tool for clearing confusion about blockchain scalability and blocksize-related debates.
The DCS Theorem is a probability proof of the triangle, and it’s now on arXiv: