From mboxrd@z Thu Jan 1 00:00:00 1970 Received: from sog-mx-2.v43.ch3.sourceforge.com ([172.29.43.192] helo=mx.sourceforge.net) by sfs-ml-1.v29.ch3.sourceforge.com with esmtp (Exim 4.76) (envelope-from ) id 1RYx68-0005nk-B9 for bitcoin-development@lists.sourceforge.net; Fri, 09 Dec 2011 09:50:32 +0000 Received-SPF: pass (sog-mx-2.v43.ch3.sourceforge.com: domain of gmail.com designates 209.85.215.175 as permitted sender) client-ip=209.85.215.175; envelope-from=andyparkins@gmail.com; helo=mail-ey0-f175.google.com; Received: from mail-ey0-f175.google.com ([209.85.215.175]) by sog-mx-2.v43.ch3.sourceforge.com with esmtps (TLSv1:RC4-SHA:128) (Exim 4.76) id 1RYx66-0001OD-24 for bitcoin-development@lists.sourceforge.net; Fri, 09 Dec 2011 09:50:32 +0000 Received: by eaal1 with SMTP id l1so28680eaa.34 for ; Fri, 09 Dec 2011 01:50:23 -0800 (PST) Received: by 10.213.15.69 with SMTP id j5mr674075eba.128.1323424223705; Fri, 09 Dec 2011 01:50:23 -0800 (PST) Received: from dvr.localnet (mail.360visiontechnology.com. [92.42.121.178]) by mx.google.com with ESMTPS id d6sm29065994eec.10.2011.12.09.01.50.18 (version=TLSv1/SSLv3 cipher=OTHER); Fri, 09 Dec 2011 01:50:19 -0800 (PST) From: Andy Parkins To: bitcoin-development@lists.sourceforge.net Date: Fri, 9 Dec 2011 09:50:03 +0000 User-Agent: KMail/1.13.6 (Linux/3.0.0-1-686-pae; KDE/4.6.3; i686; ; ) References: <201112081047.09082.andyparkins@gmail.com> <4EE13D8C.2020308@justmoon.de> In-Reply-To: <4EE13D8C.2020308@justmoon.de> MIME-Version: 1.0 Content-Type: multipart/signed; boundary="nextPart4632628.C0BYzMbHC6"; protocol="application/pgp-signature"; micalg=pgp-sha1 Content-Transfer-Encoding: 7bit Message-Id: <201112090950.10974.andyparkins@gmail.com> X-Spam-Score: -1.6 (-) X-Spam-Report: Spam Filtering performed by mx.sourceforge.net. See http://spamassassin.org/tag/ for more details. -1.5 SPF_CHECK_PASS SPF reports sender host as permitted sender for sender-domain 0.0 FREEMAIL_FROM Sender email is commonly abused enduser mail provider (andyparkins[at]gmail.com) -0.0 SPF_PASS SPF: sender matches SPF record -0.1 DKIM_VALID_AU Message has a valid DKIM or DK signature from author's domain 0.1 DKIM_SIGNED Message has a DKIM or DK signature, not necessarily valid -0.1 DKIM_VALID Message has at least one valid DKIM or DK signature X-Headers-End: 1RYx66-0001OD-24 Subject: Re: [Bitcoin-development] Lowering confirmation requirements and preventing double spends X-BeenThere: bitcoin-development@lists.sourceforge.net X-Mailman-Version: 2.1.9 Precedence: list List-Id: List-Unsubscribe: , List-Archive: List-Post: List-Help: List-Subscribe: , X-List-Received-Date: Fri, 09 Dec 2011 09:50:32 -0000 --nextPart4632628.C0BYzMbHC6 Content-Type: Text/Plain; charset="iso-8859-1" Content-Transfer-Encoding: quoted-printable On 2011 December 08 Thursday, Stefan Thomas wrote: > Bitcoin already does something which in practice has exactly this > effect: If a transaction is reversed, any transactions based on its > outputs are rejected. That part is fine; I was aware that Bitcoin did this. How could it not? T= he=20 transactions form multiple signature chains of their own. It impossible to= =20 have a transaction depend on a non-existent input transaction. > Hosted wallets can make use of this - but as you correctly point out, > depending on the service, it can get tricky. What if I exchange the > money to USD and back before withdrawing? You could have an algorithm > where MtGox prefers to spend outputs from your own deposits as the > inputs for your withdrawals, it's not trivial though and never 100% secur= e. Quite so; this is essentially the problem my suggestion addresses. What do= =20 you do when a transaction is dependent on another transaction financially b= ut=20 not technically? That is to say that your accounting software would show a= =20 credit and a debit to a particular entity, but the bitcoin block chain woul= d=20 not. In the old world we might do this as "I'll write you a cheque and you= =20 give me cash"; if that cheque bounces, you've lost your cash. > I have trouble thinking of a good example where you need an explicit > block dependency as you describe. The only times you'd want to use this > dependency of transactions on specific previous transactions is when you > can clearly and easily associate the money. But if you can clearly and > easily associate the money, you might as well just relate the > transactions (use the outputs from the deposit transaction as the inputs > of the withdrawal transaction.) The MyBitcoin debacle (if we are to believe their reports) would have been= =20 avoided by my suggestion. They were accepting deposits in one chain, and=20 allowing withdrawls from another. That meant that while there was a financ= ial=20 connection, there was not a bitcoin-connection. The withdrawls happened fr= om=20 the pool address, most likely well funded, so were valid on either chain. = If=20 MyBitcoin had been able to broadcast the withdrawl transactions as being ba= sed=20 on the same chain as the deposit (even though it was not using transactions= in=20 that chain) then the attack would have failed. > This is btw something that would strongly agree with: Hosted wallets > should absolutely keep each account as separate public keys. With that > you lose free and instant internal transactions, but you gain instant > deposits and much better risk isolation. I'm not sure I agree. There is certainly a case for both types: one-to-one= =20 correspondence between address and account has the advantages you list but = is=20 highly identifiable and trackable. However the disadvantage is that all fu= nds=20 would have to be kept online. Places like Mt.Gox can (although there is=20 evidence to suggest that they don't, tut tu) move the majority of the funds= to=20 five USB sticks, and keep them in five fire-proof safes or deposit boxes or= =20 whatever only because deposited funds are pooled. > This is just my view. Thanks and keep the thought-provoking stuff coming! Thanks for the encouragement. It's appreciated. Andy =2D-=20 Dr Andy Parkins andyparkins@gmail.com --nextPart4632628.C0BYzMbHC6 Content-Type: application/pgp-signature; name=signature.asc Content-Description: This is a digitally signed message part. -----BEGIN PGP SIGNATURE----- Version: GnuPG v1.4.10 (GNU/Linux) iEYEABECAAYFAk7h2cwACgkQwQJ9gE9xL21pBQCfcZdGOTke/RxOqU/QWdihvfqj j1wAnjdn1Z+/n8qr0SOadlaIcsT9b4QE =Ty27 -----END PGP SIGNATURE----- --nextPart4632628.C0BYzMbHC6--