> Why do we need another HTLC to be established from B to A ?

We don't. This wasn't what I was saying. The atomic swap example was just
to show that your idea does exist in a different context. An atomic swap
can be viewed as a payment A -> B -> A where B switches the currency.

> Pardon me if I am wrong but I am still confused why situation 1 will not
be possible ?

It is possible. In A -> B, A is able to punish B for not revealing secret.
The problem is with A -> B -> C, the HTLCs need to be set up from left to
right, A can't punish B for not revealing secret because he doesn't know
it. B cannot set up the HTLC to C before having the HTLC from A. So it
doesn't work -- or at least that's the conventional conclusion. To
summarise:

A -> B : punishment works
A -> B -> A: punishment works
A -> B -> C: it can't work (we think)

LL

On Fri, Mar 6, 2020 at 6:03 PM Subhra Mazumdar <
subhra.mazumdar1...@gmail.com> wrote:

> Can you send the draft on fair atomic swap? Also the scenario stated in
> the pdf you have shared is based on exchange of asset. But here I am not
> trying to work on different ledger A to B and B to A. Here it deals with
> just simple transfer of funds from A to B. So whatever HTLC A establishes
> with B, is it not the case where just one HTLC from A to B is enough? Why
> do we need another HTLC to be established from B to A ?  To clarify this,
> we have two situation -
> 1. HTLC A & B (on channel AB): both A and B lock say 0.1 BTC each i.e. 0.2
> BTC
> 2. HTLC A&B (on channel AB) : A locks 0.1 BTC, HTLC B&A (on channel BA): B
> locks 0.1 BTC
>
> Pardon me if I am wrong but I am still confused why situation 1 will not
> be possible ?
>
> On Fri, Mar 6, 2020 at 12:00 PM Lloyd Fournier <lloyd.fo...@gmail.com>
> wrote:
>
>> Hi Subhra,
>>
>> Afaik, the only problem is the one you identified, it doesn't work across
>> multiple hops but only for the final hop. This penalty idea is the basis
>> for doing atomc swaps fairly:
>> https://coblox.tech/docs/financial_crypto19.pdf
>>
>> LL
>> On Fri, Mar 6, 2020 at 4:58 PM Subhra Mazumdar <
>> subhra.mazumdar1...@gmail.com> wrote:
>>
>>> Hi,
>>>       I was reading the paper by Poon and Dryja on Bitcoin Lightning
>>> Network and was going through the construction of HTLC. Suppose 2 parties A
>>> and B have a channel with each party locking 0.5 BTC. Suppose A wants to
>>> transfer 0.1 BTC to B contingent to the knowledge of R : H=h(R) produced
>>> within a locktime of say t days. So the script output for A is -
>>> 1. 0.4 BTC to A
>>> 2. 0.5 BTC to B
>>> 3. 0.1 BTC locked in HTLC between A & B.
>>> Why we cannot set the terms as say 0.4 BTC to A, 0.2 BTC to B and 0.4
>>> BTC to HTLC, where HTLC output can follow either of the paths - If B
>>> produces R within t days then it gets back 0.4 BTC else after t days A can
>>> broadcast with 0.4 BTC going to the A? This prevents B from not responding
>>> (and induce possibly griefing attack across a longer path by withholding
>>> the solution) since it will lose out 0.3 BTC. What can be the problem if
>>> the terms of HTLC itself tries to enforce a penalty on the counterparty?
>>>
>>> --
>>> Yours sincerely,
>>> Subhra Mazumdar.
>>>
>>> _______________________________________________
>>> Lightning-dev mailing list
>>> Lightning-dev@lists.linuxfoundation.org
>>> https://lists.linuxfoundation.org/mailman/listinfo/lightning-dev
>>>
>>
>
> --
> Yours sincerely,
> Subhra Mazumdar.
>
>
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