Re: [Lightning-dev] [bitcoin-dev] Batch exchange withdrawal to lightning requires covenants

2023-10-18 Thread ZmnSCPxj via Lightning-dev


Good morning Greg,


> > I do not know if existing splice implementations actually perform such a 
> > check.
> Unless all splice implementations do this, then any kind of batched splicing 
> is risky.
> As long as the implementation decides to splice again at some point when a 
> prior
> splice isn't confirming, it will self-resolve once any subsequent splice is 
> confirmed.

Do note that there is a risk here that the reason for "not confirming" is 
because of an unexpected increase in mempool usage.

In particular, if the attack is not being performed, it is possible for the 
previous splice tx that was not confirming for a while, to be the one that 
confirms in the end, instead of the subsequent splice.
This is admittedly an edge case, but one that could potentially be specifically 
attacked and could lead to loss of funds if the implementations naively deleted 
the signatures for commitment transactions for the previously-not-confirming 
splice transaction.

Indeed, as I understood it, part of the splice proposal is that while a channel 
is being spliced, it should not be spliced again, which your proposal seems to 
violate.

Regards,
ZmnSCPxj
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Re: [Lightning-dev] [bitcoin-dev] Batch exchange withdrawal to lightning requires covenants

2023-10-18 Thread Greg Sanders
> I do not know if existing splice implementations actually perform such a
check.
Unless all splice implementations do this, then any kind of batched
splicing is risky.

As long as the implementation decides to splice again at some point when a
prior
splice isn't confirming, it will self-resolve once any subsequent splice is
confirmed.

Cheers,
Greg

On Tue, Oct 17, 2023 at 1:04 PM ZmnSCPxj via bitcoin-dev <
[email protected]> wrote:

> Good morning Bastien,
>
> I have not gotten around to posting it yet, but I have a write-up in my
> computer with the title:
>
> > Batched Splicing Considered Risky
>
> The core of the risk is that if:
>
> * I have no funds right now in a channel (e.g. the LSP allowed me to have
> 0 reserve, or this is a newly-singlefunded channel from the LSP to me).
> * I have an old state (e.g. for a newly-singlefunded channel, it could
> have been `update_fee`d, so that the initial transaction is old state).
>
> Then if I participate in a batched splice, I can disrupt the batched
> splice by broadcasting the old state and somehow convincing miners to
> confirm it before the batched splice.
>
> Thus, it is important for *any* batched splicing mechanism to have a
> backout, where if the batched splice transaction can no longer be confirmed
> due to some participant disrupting it by posting an old commitment
> transaction, either a subset of the splice is re-created or the channels
> revert back to pre-splice state (with knowledge that the post-splice state
> can no longer be confirmed).
>
> I know that current splicing tech is to run both the pre-splice and
> post-splice state simultaneously until the splicing transaction is
> confirmed.
> However we need to *also* check if the splicing transaction *cannot* be
> confirmed --- by checking if the other inputs to the splice transaction
> were already consumed by transactions that have deeply confirmed, and in
> that case, to drop the post-splice state and revert to the pre-splice state.
> I do not know if existing splice implementations actually perform such a
> check.
> Unless all splice implementations do this, then any kind of batched
> splicing is risky.
>
> Regards,
> ZmnSCPxj
>
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Re: [Lightning-dev] [bitcoin-dev] Batch exchange withdrawal to lightning requires covenants

2023-10-18 Thread ZmnSCPxj via Lightning-dev
Good morning Bastien,

I have not gotten around to posting it yet, but I have a write-up in my 
computer with the title:

> Batched Splicing Considered Risky

The core of the risk is that if:

* I have no funds right now in a channel (e.g. the LSP allowed me to have 0 
reserve, or this is a newly-singlefunded channel from the LSP to me).
* I have an old state (e.g. for a newly-singlefunded channel, it could have 
been `update_fee`d, so that the initial transaction is old state).

Then if I participate in a batched splice, I can disrupt the batched splice by 
broadcasting the old state and somehow convincing miners to confirm it before 
the batched splice.

Thus, it is important for *any* batched splicing mechanism to have a backout, 
where if the batched splice transaction can no longer be confirmed due to some 
participant disrupting it by posting an old commitment transaction, either a 
subset of the splice is re-created or the channels revert back to pre-splice 
state (with knowledge that the post-splice state can no longer be confirmed).

I know that current splicing tech is to run both the pre-splice and post-splice 
state simultaneously until the splicing transaction is confirmed.
However we need to *also* check if the splicing transaction *cannot* be 
confirmed --- by checking if the other inputs to the splice transaction were 
already consumed by transactions that have deeply confirmed, and in that case, 
to drop the post-splice state and revert to the pre-splice state.
I do not know if existing splice implementations actually perform such a check.
Unless all splice implementations do this, then any kind of batched splicing is 
risky.

Regards,
ZmnSCPxj

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