sipa changed the topic of #bitcoin-wizards to: This channel is for discussing theoretical ideas with regard to cryptocurrencies, not about short-term Bitcoin development | http://bitcoin.ninja/ | This channel is logged. | For logs and more information, visit http://bitcoin.ninja
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<instagibbs>
oh no, Secure Element(SE) discussion with respect to Statechain Entities(SE)
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<instagibbs>
bsm117532, hacks of StateEs can definitely result in theft, provided the hacker is somewhere earlier in the chain.
<bsm117532>
Yeah I felt ill with that part of my reply...
<instagibbs>
discarding old keyshares could prevent backwards theft, but moving forward the hacker can deposit funds, multispent, whatever
<instagibbs>
maybe that's enough to constrain attacker in practical hacks
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<bsm117532>
I have a few ideas on how to get around that...if I can get one of them to work I'll post it.
<bsm117532>
Half-baked idea: there are 3 parties involved in a transfer. What if all 3 submitted entropy for the new statechain key s2 and also collaboratively signed with it, so that the SE doesn't actually know s2, but has a signature with s2 that can be used in the next transfer...
<instagibbs>
the cute thing is that you still at least detect the hack with the statechain
<instagibbs>
bsm117532, I'd actually have to sit around and think about the math, ive very much been thinking higher level with respect to Proof of Publication requirements etc. I'd be interested in a short writeup if you end up doing that
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<bsm117532>
Thinking about it, don't know how to do it yet. But if you could achieve that, the new owner *definitely* is incentivized to delete a keyshare that would give the old owner control.
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<bsm117532>
You'd need some kind of adaptor signature, created collaboratively among the three, that the SE and new owner could use to assign the UTXO to the next party.
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<bsm117532>
Another thing I've been thinking about gluing on is some implementation of petertodd's single-use seals. You could e.g. create a ZKCP that a seal is still open, and therefore I am the valid owner of this UTXO, as of the last single-use-seal-system update.
<bsm117532>
Tom Trevethan is also the creator of Mainstay, which might be described as a mechanism for single-use-seals. https://www.mainstay.xyz/
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<bsm117532>
The timelocks involved in Decker-Wattenhofer bother me greatly, as they provide an avenue for a previous owner to grief the current owner, locking up his funds.
<bsm117532>
What might be desirable is if the current owner could immediately spend any past owner's on-chain withdrawal, *back* into the statechain. So 2 tx's may appear on the chain, but the current owner can continue as if nothing happened, as long as the statechain is watching the mempool and it's assumed this 2-tx chain gets mined at some point.
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