Mastering the Lightning Network book - page 2.

BitDane

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Quote from: darkv0rt3x on January 13, 2023, 06:12:16 AM

So, what any other funds there are to be received by node B other than the 60%??? This is the part I'm not understanding!

In an example person A and person B had agreed to send 0.5 BTC each making the channel balance 1 BTC. Person A send 0.5 to person Person B and person B send 0.1 making the balance Person A = 0.1 BTC and person B = 0.9 BTC.

Then person B goes offline and Person A wanted to cheat Person B by sending an outdated version of the commitment transaction to the blockchain showing a balance of Person A 0.6 BTC and person B 0.4 BTC. and the person B due to being offline failed to detect the cheat before the timelock expires. Person B will only be able to claim 0.4 instead of the 0.9 BTC and the rest will be claimed by the cheater person A which is 0.6 BTC instead of 0.1 BTC

This way the cheater is able to get more BTC in expense of the other party. I hope I explain it clear enough.

darkv0rt3x

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I rather die on my feet than to live on my knees

I think I understand the concept behind the penalty transaction. What I don't understand from that quote is what other funds there are that "any funds you received after this have been stolen by my partner".

So let's say 2 nodes (A and B) have a channel with 40% / 60%, respectively. Then, a new balance was updated and ended up with 30% / 70%. Supposedly, the 40% / 60% commitment transaction is revoked and no longer valid. However, node B goes offline and node A broadcast the revoked commitment transaction with 40 % / 60% and node B fails to detect this breach because it was offline long enough for the timelock to expire. In this scenario, node B will get only the 60% of the funds that were allocated by the broadcast of the revoked commitment transaction by node A.

The mentioned quote says:

Quote

Any funds you received after this will have been stolen by your partner

So, what any other funds there are to be received by node B other than the 60%??? This is the part I'm not understanding!

BitDane

sr. member

Activity: 1372

Merit: 348

Quote from: darkv0rt3x on January 12, 2023, 07:46:36 PM

Specifically this part:

Quote

Any funds you received after this will have been stolen by your partner.

If we are not able to detect te cheater peer, we only get the funds that were allocated by the commitment transaction broadcast by the cheating peer, right? So, if this is correct, what are this "any funds I received after this will have been stolen by your partner"??

Cheats happen when a party broadcasted an outdate version of the commitment transaction. It means the cheater shows you an old balance or the one that does not reflect the latest balance in the channel. With these action of broadcasting an outdated version, the cheater trick you to believe that they have a bigger balance than he is entitled to. This is called breach or a channel counterparty breach where the cheater can claim more fund that what he should have at the expense of the other party.

Here is an example:

Quote

For example, let's say the channel has a balance of 1 BTC and the other party has sent 0.5 BTC. The cheater can broadcast an old commitment transaction that shows a balance of 0.7 BTC in their favor, claiming the 0.2 BTC that they shouldn't have.

https://www.researchgate.net/figure/Lightning-Channels-Each-party-has-a-Commitment-Transaction-that-only-they-can-broadcast_fig6_304621007

BitMaxz

legendary

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Block halving is coming.

I think it talks about closing a channel?

Based on what I understand the timelock expires is I think the dispute period according to the wiki if you didn't find the protocol breach all the funds that you received from your open channel will be gone but the deposit amount when you open a channel you can still able to take them out with fees.

protocol breach looks like you need proof that your partner is a cheater or doing fraud most cheaters or fraudsters send/broadcast outdated data with the incorrect distribution. So to avoid it you need to broadcast the most up-to-date settlement transaction to the network.

I think wiki explains better that the link you shared above read this https://en.wikipedia.org/wiki/Lightning_Network

darkv0rt3x

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I rather die on my feet than to live on my knees

Hi.

I started reading this book, written by Antonopoulos, Osuntokun and Pickardt, right at github, here.

I have created this thread to ask questions about the contents of the book whenever I'm unable to understand a sentence, a subject, an example or watever question I may have.

If others also want to ask questions on top of my questions, feel free but I would like to keep the thread kind of limited to my questions and people's answers so that I don't lose focus on each question/answer.

When I have a question, I'll try to link it and provide the most information possible to it and/or context.

To start, I'm at the middle of Chapter 3, reading further down in Section Protocol Breach (the ugly way).

The part I'm not fully understanding is this:

Quote

If you fail to detect the protocol breach and the timelock expires, you will receive only the funds allocated to you by the commitment transaction your partner published. Any funds you received after this will have been stolen by your partner. If there is any balance allocated to you, you will have to pay on-chain fees to collect that balance.

Specifically this part:

Quote

Any funds you received after this will have been stolen by your partner.

If we are not able to detect te cheater peer, we only get the funds that were allocated by the commitment transaction broadcast by the cheating peer, right? So, if this is correct, what are this "any funds I received after this will have been stolen by your partner"??

Topic: Mastering the Lightning Network book - page 2. (Read 311 times)