Hi Robin,
inline...
‐‐‐‐‐‐‐ Original Message ‐‐‐‐‐‐‐
On Monday, January 13, 2020 7:47 PM, Robin Linus <robinli...@protonmail.com>
wrote:
> Hi Joachim,
>
> Thank you for your detailed feedback!
>
> Regarding Reason #1:
> This proposal is less like Bitcoin vs. Altcoins and much more like Ethereum
> vs. ERC20 tokens, because the derivatives are not in competition with BTC,
> but depend on it heavily. You support Bitcoin's growth by supporting such a
> sidechain.
> Also, they won't work as separate currencies. For endusers you can abstract
> away all underlying complexities such that they have to think only in BTC.
> Exchanges rates can be hidden in TX fees. The sidechain derivatives would be
> nothing but a means of transfer. The unit of account is still BTC.
I can't see any difference and advantage over doing the same with say Litecoin.
All you need is to create a special wallet which offers atomic swaps LTC-BTC
and its unit of account displayed to user is going to be BTC. All you say will
work perfectly with this special LTC wallet. Therefore your idea is as good as
any other altcoin. In your case, someone else should indeed be able to create
such a wallet in which the unit of account will be the new token, thus
emulating the current LTC wallets. So the only difference in Litecoin is that
the special wallet with BTC as unit is going to be created after the native
one, while in your case it is vice versa.
I simply can't see why I'd call this construction of yours a Bitcoin sidechain
and any other altcoin not. So I'd call both altcoins.
> Regarding Reason #2:
> In the "Limitations" section I discuss the cost of halting the chain:
>
> Time value of locked bitcoins might be too cheap to protect the chain. We can
> introduce an additional cost and let validators burn bitcoins for every
> on-chain vote. This is much more robust because there is an ongoing cost for
> halting the system. Proof-of-burn has recently been formally analysed [16].
> The economic implications of burning significant amounts of Bitcoin are
> questionable. A level of security comparable to Bitcoin requires the system’s
> BTC burn rate to be equal to Bitcoin’s infaltion rate.
>
> Also remember, time value of Bitcoins is indeed a value. Even without a proof
> of burn, I'd consider such sidechains much more secure than those custodial
> lightning wallets which become more and more popular to circumvent the
> usability hurdles of the LN.
Comparison to other models is not relevant to my claim that such construction
is insecure for small sidechains. And for big sidechains the reason #1 prefers
any other altcoin. Even if you introduce proof of burn, the final attack cost
is small for an attacker in absolute numbers, despite the fact that in the
relative numbers the cost is huge.
> Thanks again,
> - Robin
>
> Sent with [ProtonMail](https://protonmail.com) Secure Email.
>
> ‐‐‐‐‐‐‐ Original Message ‐‐‐‐‐‐‐
> On Monday, January 13, 2020 7:06 PM, Joachim Strömbergson
> <joachim...@protonmail.com> wrote:
>
>> While I haven't rejected sidechains entirely yet, this particular proposal
>> seems uninteresting, especially for two reasons.
>>
>> One – it introduces a new token for each sidechain and suggests atomic swaps
>> to be used for the exchange of the mainchain token with the sidechain token.
>> Such a model seems nonsensical to me because there seems to be excessive
>> number of blockchain projects that can be used similarly just as the
>> sidechain in this proposal. Pick almost any altcoin out there and you can
>> atomic swap it with Bitcoin. The fact that your sidechain is somehow
>> mathematically bound to Bitcoin seems arbitrary because at the end you have
>> a new token and a new issuance model. Therefore this is not extending
>> Bitcoin economy, which is strictly limited by its convergence to zero
>> inflation. This proposal is inflating the supply with a new token, which
>> goes against what many people consider as a pillar of Bitcoin's value
>> proposal. I think if you implement this proposal, you are going not to be
>> considered as a Bitcoin sidechain, but you will be, from certain point of
>> view, indistinguishable from any other altcoin. At the level of my current
>> understanding, the only interesting sidechain model is the [theoretical] one
>> with a two way peg with Bitcoin, preserving the issuance policy of Bitcoin.
>>
>> Two – the security of the proposed system seems to be very fragile, unless I
>> have missed something. When I think about sidechains, I expect that it
>> should be possible to create a niche chain which is used by few participants
>> while the security of the chain is somehow guaranteed from its bind to the
>> mainchain. If this was not the case, such a niche sidechain could easily be
>> attacked, even if just stalled/censored for a long period time, with just a
>> small [absolute] investment from an attacker, although this investment might
>> be large if taken relatively to the utility of this niche sidechain. So if
>> we speak concretely about your proposal, you assume honest majority of
>> validators. But in your system the validators come from locking of stake on
>> Bitcoin chain by nodes that are interested in a particular sidechain. If you
>> put this model on a niche chain where only few participants are interested
>> in it, it's trivial for an attacker to be stronger [have more Bitcoin to
>> lock] than all legitimate users together. You should only use honest
>> majority assumption where the scope is global, where it is very hard and
>> very expensive to obtain majority.
>>
>> Sent with [ProtonMail](https://protonmail.com) Secure Email.
>>
>> ‐‐‐‐‐‐‐ Original Message ‐‐‐‐‐‐‐
>> On Sunday, January 12, 2020 6:54 PM, Robin Linus via bitcoin-dev
>> <bitcoin-dev@lists.linuxfoundation.org> wrote:
>>
>>> Hi all,
>>>
>>> I've been working on a sidechain protocol with no trusted third party. You
>>> can find the [whitepaper here](http://coins.github.io/coins.pdf).
>>>
>>> Abstract. Coins is a Bitcoin extension designed for payments at scale. We
>>> propose an efficient solution to the double-spending problem using a
>>> bitcoin-backed proof-of-stake. Validators vote on sidechain blocks with
>>> one-time signatures, forming a record that cannot be changed without
>>> destroying their collateral. Every user can become a validator by locking
>>> bitcoins. One-time signatures guarantee that validators loose their stake
>>> for publishing conflicting histories. Checkpoints can be additionally
>>> secured with a bitcoin-backed proof-of-burn. Assuming a rational majority
>>> of validators, the sidechain provides safety and liveness. The sidechain’s
>>> footprint within bitcoin’s blockchain is minimal. The protocol is a generic
>>> consensus mechanism allowing for arbitrary sidechain assets. Spawning
>>> multiple, independent instances scales horizontally.
>>>
>>> Feedback is highly appreciated!
>>>
>>> Thank you
>>>
>>> - Robin
>>>
>>> PS: [Here on Github you can find further research on scalability and
>>> usability](https://github.com/coins/coins.github.io).
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