From mboxrd@z Thu Jan 1 00:00:00 1970 Return-Path: Received: from fraxinus.osuosl.org (smtp4.osuosl.org [140.211.166.137]) by lists.linuxfoundation.org (Postfix) with ESMTP id 100DEC0051 for ; Sun, 4 Oct 2020 14:25:14 +0000 (UTC) Received: from localhost (localhost [127.0.0.1]) by fraxinus.osuosl.org (Postfix) with ESMTP id E9E6E84C44 for ; Sun, 4 Oct 2020 14:25:13 +0000 (UTC) X-Virus-Scanned: amavisd-new at osuosl.org Received: from fraxinus.osuosl.org ([127.0.0.1]) by localhost (.osuosl.org [127.0.0.1]) (amavisd-new, port 10024) with ESMTP id vByCp26TpUY5 for ; Sun, 4 Oct 2020 14:25:11 +0000 (UTC) X-Greylist: domain auto-whitelisted by SQLgrey-1.7.6 Received: from mail4.protonmail.ch (mail4.protonmail.ch [185.70.40.27]) by fraxinus.osuosl.org (Postfix) with ESMTPS id 5E6BE844C9 for ; Sun, 4 Oct 2020 14:25:11 +0000 (UTC) Date: Sun, 04 Oct 2020 14:24:59 +0000 DKIM-Signature: v=1; a=rsa-sha256; c=relaxed/relaxed; d=protonmail.com; s=protonmail; t=1601821508; bh=vK/pFzpy1/bjlqkyooWJu7mR5Hsde6RsyC0tFUYs8V8=; h=Date:To:From:Cc:Reply-To:Subject:In-Reply-To:References:From; b=Z+I0dKNXG4B798XRVkeflDRagFgznqtjhrV0Mk0l9axynv7Ymwnqk7ZDZKHvcLE6X 6K+VwMsJk50GKir0ey2jDju0M62BHeiDAYHd1/4df8GxA5V1F/FbJfUPhmYqs7InuX KUMC9hVTfS14ROVXwC7CtODGmZ2PvbX+EOYu4Ukw= To: Thomas Hartman From: ZmnSCPxj Reply-To: ZmnSCPxj Message-ID: In-Reply-To: References: <976903d1529adef2aff8839290a91f2c.squirrel@giyzk7o6dcunb2ry.onion> MIME-Version: 1.0 Content-Type: text/plain; charset=utf-8 Content-Transfer-Encoding: quoted-printable Cc: Bitcoin Protocol Discussion Subject: Re: [bitcoin-dev] A thought experiment on bitcoin for payroll privacy X-BeenThere: bitcoin-dev@lists.linuxfoundation.org X-Mailman-Version: 2.1.15 Precedence: list List-Id: Bitcoin Protocol Discussion List-Unsubscribe: , List-Archive: List-Post: List-Help: List-Subscribe: , X-List-Received-Date: Sun, 04 Oct 2020 14:25:14 -0000 Good morning Thomas, > "big to-network channel" > > nit: should this be "big from-network channel" ? As Lightning Network channels are bidirectional, it would be more properly = "to/from-network", but that is cumbersome. "to-network" is shorter by two characters than "from-network", and would be= true as well (since the channel is bidirectional, it is both a "to-network= " and "from-network" channel), thus preferred. > > thanks for this explanation. You are welcome. Regards, ZmnSCPxj > On Sat, Oct 3, 2020 at 11:45 PM ZmnSCPxj via bitcoin-dev > bitcoin-dev@lists.linuxfoundation.org wrote: > > > Good Morning Mr. Lee, > > > > > I cannot front up funds of my own to give > > > them inbound balance because it would consume all of my treasury to l= ock > > > up funds. > > > > This is not a reasonable assumption! > > Suppose you have a new hire that you have agreed to pay 0.042BTC every = 2 weeks. > > On the first payday of the new hire, you have to have at least 0.042BTC= in your treasury, somehow. > > If not, you are unable to pay the new hire, full stop, and you are doom= ed to bankruptcy and your problems will disappear soon once your cut-throat= new hire cuts your throat for not paying her or him. > > If you do have at least 0.042BTC in your treasury, you can make the cha= nnel with the new hire and pay the salary via the new channel. > > At every payday, you need to have at least the salary of your entire em= ployee base available, otherwise you would be unable to pay at least some o= f your employees and you will quickly find yourself with your throat cut. > > Now, let us talk about topology. > > Let us reduce this to a pointless topology that is the worst possible t= opology for Lightning usage, and show that by golly, Lightning will still w= ork. > > Suppose your company only has this one big channel with the network. > > Let us reduce your company to only having this single new hire throat-c= utter (we will show later that without loss of generality this will still w= ork even if you have thousands of throat-cutters internationally). > > Now, as mentioned, on the first payday of your throat-cutter, you have = to have at least the 0.042 salary you promised. > > If you have been receiving payments for your throat-cutting business on= the big channel, that means the 0.042 BTC is in that single big channel. > > You can then use an offchain-to-onchain swap service like Boltz or Loop= and put the money onchain. > > Then you can create the new channel to your new hire and pay the promis= ed salary to the throat-cutter. > > Now, you have no more funds in either of your channels, the to-network = big channel, and the to-employee channel. > > So you are not locking up any of your funds, only the funds of your emp= loyee. > > Now, as your business operates, you will receive money in your to-netwo= rk big channel. > > The rate at which you receive money for services rendered has to be lar= ger than 0.042/2weeks on average, otherwise you are not earning enough to p= ay your throat-cutter by the time of the next payday (much less your other = operating expenses, such as knife-sharpening, corpse disposal, dealing with= the families of the deceased, etc.). > > If you are not earning at a high enough rate to pay your employee by th= e next payday, your employee will not be paid and will solve your problems = by cutting your throat. > > But what that means is that the employee salary of the previous payday = is not locked, either! > > Because you are receiving funds on your big to-network channel continuo= usly, the employee can now spend the funds "locked" in the to-employee chan= nel, sending out to the rest of the network. > > This uses up the money you have been earning and moving the funds to th= e to-employee channel, but if you are running a lucrative business, that is= perfectly fine, since you should, by the next payday, have earned enough, = and then some, to pay the employee on the next payday. > > Of course there will be times when business is a little slow and you ge= t less than 0.042/2weeks. > > In that case, a wise business manager will reserve some funds for a rai= ny day when business is a little slow, meaning you will still have some fun= ds you can put into your to-network big channel for other expenses, even as= your employee uses capacity there to actually spend their salary. > > It all balances out. > > You only need to keep enough in your channels to cover your continuous = operational expenses, and employee salaries are operational expenses. > > Suppose you now want to hire another throat-cutter. > > You would only do that if business is booming, or in other words, if yo= u have accumulated enough money in your treasury to justify hiring yet anot= her employee. > > By induction, this will work regardless if you have 1 employee, or 1 mi= llion. > > Regards, > > ZmnSCPxj > > > > bitcoin-dev mailing list > > bitcoin-dev@lists.linuxfoundation.org > > https://lists.linuxfoundation.org/mailman/listinfo/bitcoin-dev