Tuesday, August 16

Satoshi’s Eye Will Fight Bitcoin Lightning Network Fraud

Key facts:
  • The developer works on watchtowers, a big step towards making Lightning more secure.

  • Each user would have their own watchtower to keep an eye on their Lightning channels in the future.

It seems that many people behave better when they feel that they are being watched by an omnipresent being. That is something that the Spanish developer Sergi Delgado, who is the founder of Talaia Lab, creators of The Eye of Satoshi (The Eye of Satoshi). It is an implementation of watchtower or watchtowers for the payment channels with bitcoin of the Lightning network, which it considers necessary for when the world reaches the massive adoption of the cryptocurrency.

It will be as if the gaze of the creator of bitcoin neutralizes bad behavior on payment channels and ensures that acts of fraud will not go unnoticed. This, in part, explains the importance of Delgado’s work, while keeping the analogy on the surface.: The Eye of Satoshi will prevent someone from closing a channel and taking advantage of it.

As they are now, the payment channels of the Lightning network are opened through a 2 of 2 multi-signature transaction, which is handled by both parties. Either party has the secret to revoke the multiple signature contract and close the channel at any time.

So far everything seems to be fine. The problem arises when a malicious actor tries to close a channel arbitrarily without the other party noticing. In this case, you can try to close the channel with a false balance status, and if your counterpart does not connect to broadcast and claim the real balance in the indicated time, the offender will be able to put all the balance that he had indicated on his side, it is In other words, you will have stolen the balance that was in the possession of your channel partner.

That’s where they come in the watchtowers of the Lightning network, a development that Delgado considers of great importance, although for now, it is seen as a side job for the bitcoin ecosystem, as explained to CriptoNoticias. By clicking here you can see it on video.

“Watchtowers are seen as secondary, but if we think of hyperbitcoinization, where billions of people are using Lightning, it is a fact that they are required so that everyone could be protected. This type of infrastructure is necessary, especially if what everyone is using is mobile nodes, which will be the most common in a hyperbitcoinization that will hardly be achieved only with people running nodes at home ”.

Sergi Delgado, developer of The Eye of Satoshi.

The developer Sergi Delgado coincided with the CriptoNoticias team that visited El Salvador, where they discussed the progress of their project. Source: Screenshot / youtube.com

Satoshi’s eye punishes the offender and protects privacy

If a bad actor closes a channel while his counterpart has an active watchtower on his Lightning node, he will be instantly penalized. So the honest actor will keep his funds, while the offender will get the punishment.

“The grace of this is that I running a watchtower can cover some people and that they, with another watchtower, can cover other people, then we cover each other. Also, there could be paid services, or just altruistic people who want to have a watchtower because they want to cover the network ”.

Sergi Delgado, developer of The Eye of Satoshi.

The design space of watchtower It is very broad and there may be different types of implementations where some guarantee privacy, but others will not. However, Sergi Delgado told CriptoNoticias that he is making sure that The Eye of Satoshi is a watchtower that guarantees the protection of data.

“The design of the watchtowers is much more complex than I could initially imagine, although at first glance it did not appear to be that complex. But when you want to do it anonymously respecting the privacy of the user, trying to protect the minimum amount of user information so that the tower does not have any type of advantages, then the design becomes complicated. In addition, I work so that the tower is protected so that the user cannot attack it ”.

Sergi Delgado, developer of The Eye of Satoshi.

Last year Sergi Delgado received a grant from Square Crypto to support the construction of his watchtower for the Lightning Network. Source: Screenshot / youtube.com

The Spanish developer is not the only one working on watchtowers to protect the Lightning network’s bitcoin payment channels. In fact, one of the first to implement watchtower it was Simple Bitcoin Wallet, as well as the Lightning Network Daemon (LND). The truth is that the concept has been floating in space since 2017, but most wallets do not have these so-called surveillance systems.

“There is a way to protect those channels by design because with constant use your node will verify that nothing has happened on the network and that there has not been any attempted fraud. But if you don’t open your mobile node for a considerable amount of time, it may happen that someone else has closed the channel and you haven’t even noticed it ”.

Sergi Delgado, developer of The Eye of Satoshi.

If anything, different watchtower implementations face one big hurdle, that of interoperability between all watchtowers.

“The big problem here is that each of the implementations out there today only works with its node implementation. That is, if you have an LND watchtower, you should only run it with the LND node itself. Although all implementations do the exact same thing, they are based on different design ideas and therefore cannot communicate and this is limiting for one LND user, for example, to cover others using other wallets. “

Sergi Delgado, developer of The Eye of Satoshi.

There are obstacles today, but it is clear that watchtowers are in an early stage of development, therefore their adoption is not widespread on the web. However, in the future, when the adoption of bitcoin is broader, the need will surely arise for everyone to have a watchtower for the capital that they handle through their payment channels, they are always protected.

As reported by CriptoNoticias in June of last year, Sergi Delgado received a grant in the amount of USD 100,000 from Square Crypto to support the construction of your project for the Lightning Network.

At that time the startup He explained that the developer’s work is important to the Lightning network, which will benefit from having multiple watchtowers. “The more brains there are in space, the sooner Lightning will be ubiquitous,” they said.


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