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judymcconville@roadrunner.com 2017-05-02 13:17:20 -07:00
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@ -317,7 +317,7 @@ Now that we understand how timelocks can be used to invalidate prior commitments
==== Asymmetric Revocable Commitments
A better way to handle the prior commitment states is to explicitly revoke them. However, this is not easy to achieve. A key characteristic of bitcoin is that once a transaction is valid, it remains valid and does not expire. The only way to cancel a transaction is by double-spending its inputs with another transaction before it is mined. That's why we used timelocks in the simple payment channel example above, to ensure that more recent commitments could be spent before older commitments were valid. However, sequencing commitments in time creates a number of constraints that make payment channels difficult to use.
((("payment (state) channels", "asymmetric revocable commitments", id="PSCaymetric12")))A better way to handle the prior commitment states is to explicitly revoke them. However, this is not easy to achieve. A key characteristic of bitcoin is that once a transaction is valid, it remains valid and does not expire. The only way to cancel a transaction is by double-spending its inputs with another transaction before it is mined. That's why we used timelocks in the simple payment channel example above, to ensure that more recent commitments could be spent before older commitments were valid. However, sequencing commitments in time creates a number of constraints that make payment channels difficult to use.
Even though a transaction cannot be canceled, it can be constructed in such a way as to make it undesirable to use. The way we do that is by giving each party a _revocation key_ that can be used to punish the other party if they try to cheat. This mechanism for revoking prior commitment transactions was first proposed as part of the Lightning Network.
@ -401,7 +401,7 @@ As before, these commitment transactions are asymmetric so that the commitment t
Importantly, the revocation doesn't happen automatically. While Hitesh has the ability to punish Irene for cheating, he has to watch the blockchain diligently for signs of cheating. If he sees a prior commitment transaction broadcast, he has 1000 blocks to take action and use the revocation key to thwart Irene's cheating and punish her by taking the entire balance, all 10 bitcoin.
Asymmetric revocable commitments with relative time locks (+CSV+) are a much better way to implement payment channels and a very significant innovation in this technology. With this construct, the channel can remain open indefinitely and can have billions of intermediate commitment transactions. In prototype implementations of Lightning Network, the commitment state is identified by a 48-bit index, allowing more than 281 trillion (2.8 x 10^14^) state transitions in any single channel!
Asymmetric revocable commitments with relative time locks (+CSV+) are a much better way to implement payment channels and a very significant innovation in this technology. With this construct, the channel can remain open indefinitely and can have billions of intermediate commitment transactions. In prototype implementations of Lightning Network, the commitment state is identified by a 48-bit index, allowing more than 281 trillion (2.8 x 10^14^) state transitions in any single channel!((("", startref="PSCaymetric12")))
==== Hash Time Lock Contracts (HTLC)