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Questions tagged [ln-penalty-transaction]

A penalty transaction is used to punish closing of a lightning network channel with an outdated channel state.

19 questions
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How does Lightning transaction revocation work?

I've been reading about the Lightning Network, and I feel like I alllllmost understand it, but I can't quite figure out how the revocation transactions are designed so user A can claim the channel's bitcoins if user B tries to post an out-of-date…
B T
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2 answers

Transaction overriding in lightning network

I'm reading the lightning network whitepaper, and at some point it states this: Therefore, it is possible in bitcoin to devise a bitcoin script whereby all old transactions are invalidated, and only the new transaction is valid. I would like…
Bilthon
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What is a hash pre-image as it is used for the breach remedy?

Until this afternoon I thought the anti-cheat transactions or breach remedies built on the exit-transaction of the counterparty. Apparently, they build on something called a "hash pre-image". What is it the pre-image from? How and why can it be used…
Murch
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Can miners collude to bypass the penalty based revocation system of the lightning network?

The core lightning security assumption relies on a punishment mechanism called “Justice Transaction”. However, how can you prevent a malicious user from colluding with a miner, and producing a block with old state transactions without the rest of…
Brqoo
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How is a doublespend prevented in the Lightning Network?

How Lightning Network handles double-spend? What will happen when the other person is not available online to enforce the integrity of the transactions? PFB my understanding of the Lightning Network. Lightning Network builds an additional layer on…
Holmes
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Lightning incentive for micro-cheating?

New to Lightning, and I'm having a hard time understanding something about the incentive system. So, if block sizes remain fixed, and transaction fees become prohibitively expensive one day, owing to future btc popularity, won’t there be an…
user4581
4
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2 answers

Using multiple penalty transactions to increase max HTLCs per LN channel

BOLT#2 states the below as one rationale to limit a Lighting Network channel to 483 HTLCs: It also ensures that a single penalty transaction can spend the entire commitment transaction, as calculated in BOLT #5. In other words: we're constrained…
stickies-v
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How to transmit fraudulent commitment transaction on lightning channel?

I'm trying to simulate a fraudulent commitment transaction on lightning. How would you submit an earlier commitment transaction. It doesn't seem like this can be done with a command. Does anyone know where in the code (LND or C-lightning) you could…
Joel Davidson
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What is the cost of resolving a Lightning channel breach?

If someone breaches a Lightning channel (aka tries to spend more than he is allowed to), the other party has to intervene and prove that the coins actually belong to them. This process happens on-chain. How large would such a transaction be? Is it…
Grunzwanzling
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Lightning: Why would Bitcoin Network Accept a Breach Remedy?

The Lightning Network Whitepaper discusses a situation in which one party of a payment channel broadcasts an outdated commitment transaction. The other party through a breach remedy transaction will get the cheating party's coins. How does this…
Bill Bisco
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2 answers

Order of Exchanging Revocation Keys during Lightning Transactions

How do Alice and Bob share their ephemeral private keys simultaneously? If they don't, and let's say Alice first sends Bob her private key. At this point, Bob can broadcast his current commitment transaction, and the previous commitment transaction…
Tejaswi Nadahalli
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Is eltoo more memory efficient for watchtowers?

I vaguely remember a paper which stated that in their current implementation, lightning watchtowers require a lot of memory because they need to store information about (a penalty TX for) every balance change that happens on a channel they watch.…
Hare Brained Brian
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Lightning Network: what happens if parties lose their txs?

Let's take the classical example of Alice and Bob with 0.5BTC each. Commitment Txs are exchanged for a new balance sheet: Alice has 0.6BTC, and Bob 0.4BTC. If Alice loses Bob's Breach Remedy Tx, she can still publish a Commitment Tx and get her…
Paul Razvan Berg
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Lightning Network: hashlocks vs private keys exchange

I am reading the Lightning Network paper and noticed that when describing bidirectional payment channels, the authors used "Breach Remedy transactions" and the exchange of the two parties' private keys to discourage any of the parties to broadcast…
Simone Bronzini
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Is there any tech that uses a signature as a private key?

I've been pondering how the Lightning Network will work when one of the parties in a channel tries to cheat. It seems that publishing a transaction that shouldn't be published (a "bad act") must involve publishing something the victim can use to…
Dave Scotese
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