Greg Sanders [ARCHIVE] on Nostr: 📅 Original date posted:2021-06-17 📝 Original message:Transaction analysis tools ...

📅 Original date posted:2021-06-17
📝 Original message:Transaction analysis tools do take the signal into account, but I'm unsure
if retail, non-custodial wallets use this information.

Historically the biggest pushback has been from services like Bitrefill
which have had quite a bit of success with 0-conf payments, but perhaps LN
adoption is at a point where it's less of an impact?

On Fri, Jun 18, 2021 at 4:15 AM Billy Tetrud via bitcoin-dev <
bitcoin-dev at lists.linuxfoundation.org> wrote:

> Russel O'Connor recently opined
> <https://lists.linuxfoundation.org/pipermail/bitcoin-dev/2021-June/019061.html>;
> that RBF should be standard treatment of all transactions, rather than as a
> transaction opt-in/out. I agree with that. Any configuration in a
> transaction that has not been committed into a block yet simply can't be
> relied upon. Miners also have a clear incentive to ignore RBF rules and
> mine anything that passes consensus. At best opting out of RBF is a weak
> defense, and at worst it's simply a false sense of security that is likely
> to actively lead to theft events.
>
> Do we as a community want to support 0-conf payments in any way at this
> point? It seems rather silly to make software design decisions to
> accommodate 0-conf payments when there are better mechanisms for fast
> payments (ie lightning).
>
> One question I have is: how does software generally inform the user about
> 0-conf payment detection? Does software generally tell the user something
> along the lines of "This payment has not been finalized yet. All recipients
> should wait until the transaction has at least 1 confirmation, and most
> recipients should wait for 6 confirmations" ? I think unless we pressure
> software to be very explicit about what counts as finality, users will
> simply continue to do what they've always done. Rolling out this policy
> change over the course of a year or two seems fine, no need to rush. But I
> suppose it would depend on how often 0-conf is used in the bitcoin
> ecosystem at this point, which I don't have any data on.
>
> On Tue, Jun 15, 2021 at 10:00 AM Antoine Riard via bitcoin-dev <
> bitcoin-dev at lists.linuxfoundation.org> wrote:
>
>> Hi,
>>
>> I'm writing to propose deprecation of opt-in RBF in favor of full-RBF as
>> the Bitcoin Core's default replacement policy in version 24.0. As a
>> reminder, the next release is 22.0, aimed for August 1st, assuming
>> agreement is reached, this policy change would enter into deployment phase
>> a year from now.
>>
>> Even if this replacement policy has been deemed as highly controversial a
>> few years ago, ongoing and anticipated changes in the Bitcoin ecosystem are
>> motivating this proposal.
>>
>> # RBF opt-out as a DoS Vector against Multi-Party Funded Transactions
>>
>> As explained in "On Mempool Funny Games against Multi-Party Funded
>> Transactions'', 2nd issue [0], an attacker can easily DoS a multi-party
>> funded transactions by propagating an RBF opt-out double-spend of its
>> contributed input before the honest transaction is broadcasted by the
>> protocol orchester. DoSes are qualified in the sense of either an attacker
>> wasting timevalue of victim's inputs or forcing exhaustion of the
>> fee-bumping reserve.
>>
>> This affects a series of Bitcoin protocols such as Coinjoin, onchain DLCs
>> and dual-funded LN channels. As those protocols are still in the early
>> phase of deployment, it doesn't seem to have been executed in the wild for
>> now. That said, considering that dual-funded are more efficient from a
>> liquidity standpoint, we can expect them to be widely relied on, once
>> Lightning enters in a more mature phase. At that point, it should become
>> economically rational for liquidity service providers to launch those DoS
>> attacks against their competitors to hijack user traffic.
>>
>> Beyond that, presence of those DoSes will complicate the design and
>> deployment of multi-party Bitcoin protocols such as payment
>> pools/multi-party channels. Note, Lightning Pool isn't affected as there is
>> a preliminary stage where batch participants are locked-in their funds
>> within an account witnessScript shared with the orchestrer.
>>
>> Of course, even assuming full-rbf, propagation of the multi-party funded
>> transactions can still be interfered with by an attacker, simply
>> broadcasting a double-spend with a feerate equivalent to the honest
>> transaction. However, it tightens the attack scenario to a scorched earth
>> approach, where the attacker has to commit equivalent fee-bumping reserve
>> to maintain the pinning and might lose the "competing" fees to miners.
>>
>> # RBF opt-out as a Mempools Partitions Vector
>>
>> A longer-term issue is the risk of mempools malicious partitions, where
>> an attacker exploits network topology or divergence in mempools policies to
>> partition network mempools in different subsets. From then a wide range of
>> attacks can be envisioned such as package pinning [1], artificial
>> congestion to provoke LN channels closure or manipulation of
>> fee-estimator's feerate (the Core's one wouldn't be affected as it relies
>> on block confirmation, though other fee estimators designs deployed across
>> the ecosystem are likely going to be affected).
>>
>> Traditionally, mempools partitions have been gauged as a spontaneous
>> outcome of a distributed systems like Bitcoin p2p network and I'm not aware
>> it has been studied in-depth for adversarial purposes. Though, deployment
>> of second-layer
>> protocols, heavily relying on sanity of a local mempool for
>> fee-estimation and robust propagation of their time-sensitive transactions
>> might lead to reconsider this position. Acknowledging this, RBF opt-out is
>> a low-cost partitioning tool, of which the existence nullifies most of
>> potential progresses to mitigate malicious partitioning.
>>
>>
>> To resume, opt-in RBF doesn't suit well deployment of robust
>> second-layers protocol, even if those issues are still early and deserve
>> more research. At the same time, I believe a meaningful subset of the
>> ecosystem are still relying
>> on 0-confs transactions, even if their security is relying on far weaker
>> assumptions (opt-in RBF rule is a policy rule, not a consensus one) [2] A
>> rapid change of Core's mempool rules would be harming their quality of
>> services and should be
>> weighed carefully. On the other hand, it would be great to nudge them
>> towards more secure handling of their 0-confs flows [3]
>>
>> Let's examine what could be deployed ecosystem-wise as enhancements to
>> the 0-confs security model.
>>
>> # Proactive security models : Double-spend Monitoring/Receiver-side
>> Fee-Topping with Package Relay
>>
>> From an attacker viewpoint, opt-in RBF isn't a big blocker to successful
>> double-spends. Any motivated attacker can modify Core to mass-connect to a
>> wide portion of the network, announce txA to this subset, announce txA' to
>> the
>> merchant. TxA' propagation will be encumbered by the privacy-preserving
>> inventory timers (`OUTBOUND_INVENTORY_BROADCAST_INTERVAL`), of which an
>> attacker has no care to respect.
>>
>> To detect a successful double-spend attempt, a Bitcoin service should run
>> few full-nodes with well-spread connection graphs and unlinkable between
>> them, to avoid being identified then maliciously partitioned from the rest
>> of the network.
>>
>> I believe this tactic is already deployed by few Bitcoin services, and
>> even one can throw flame at it because it over consumes network resources
>> (bandwidth, connection slots, ...), it does procure a security advantage to
>> the ones doing it.
>>
>> One further improvement on top of this protection could be to react after
>> the double-spend detection by attaching a CPFP to the merchant transaction,
>> with a higher package feerate than the double-spend. Expected deployment of
>> package-relay as a p2p mechanism/mempool policy in Bitcoin Core should
>> enable it to do so.
>>
>> # Reactive security models : EconomicReputation-based Compensations
>>
>> Another approach could be to react after the fact if a double-spend has
>> been qualified. If the sender is already known to the service provider, the
>> service account can be slashed. If the sender is a low-trusted
>> counterparty to the merchant, "side-trust" models could be relied on. For
>> e.g a LN pubkey with a stacked reputation from your autopilot, LSATs, stake
>> certificates, a HTLC-as-a-fidelity-bond, ... The space is quite wide there
>> but I foresee those trust-minimized, decentralized solutions being adopted
>> by the LN ecosystem to patch the risks when you enter in a channel/HTLC
>> operation with an anonymous counterparty.
>>
>> What other cool new tools could be considered to enhance 0-confs security
>> ?
>>
>> To conclude, let's avoid replaying the contentious threads of a few years
>> ago. What this new thread highlights is the fact that a transaction
>> relay/mempool acceptance policy might be beneficial to some class of
>> already-deployed
>> Bitcoin applications while being detrimental to newer ones. How do we
>> preserve the current interests of 0-confs users while enabling upcoming
>> interests of fancy L2s to flourish is a good conversation to have. I think.
>>
>> If there is ecosystem agreement on switching to full-RBF, but 0.24 sounds
>> too early, let's defer it to 0.25 or 0.26. I don't think Core has a
>> consistent deprecation process w.r.t to policy rules heavily relied-on by
>> Bitcoin users, if we do so let sets a precedent satisfying as many folks as
>> we can.
>>
>> Cheers,
>> Antoine
>>
>> [0]
>> https://lists.linuxfoundation.org/pipermail/lightning-dev/2021-May/003033.html
>>
>> [1] See scenario 3 :
>> https://lists.linuxfoundation.org/pipermail/lightning-dev/2020-June/002758.html
>>
>> [2] https://github.com/bitcoin/bitcoin/pull/10823#issuecomment-466485121
>>
>> [3] And the LN ecosystem does have an interest to fix zero-confs
>> security, if "turbo-channels"-like become normalized for mobile nodes
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