L1 does not support the creation of the hundreds of millions of channels necessary for decentralized lightning usage. Covenants provide shared UTXOs, which helps scale and provide privacy.
These are not mutually exclusive. Covenants deliver UTXO scaling, which improves privacy.
To scale with L2s, changes to L1s probably need to occur. Lightning whitepaper included 150MB block sizes. There aren't enough TPS to open lightning channels for 100s of millions, let alone billions of users.
1. Complexity: Implementing CTV and designing smart contracts that leverage its capabilities can be complex. This complexity could lead to bugs or vulnerabilities if not done carefully.
2. Increased transaction sizes: Using CTV often involves creating transactions with many inputs and outputs, including decoys. This can result in larger transaction sizes, which may lead to higher transaction fees.
3. Limited adoption: The privacy benefits of CTV are maximized when many people are using it. If adoption is limited, the anonymity set may be smaller, making it easier to trace transactions.
4. Regulatory concerns: The enhanced privacy features of CTV could attract regulatory scrutiny, as governments and law enforcement may be concerned about potential use for illicit activities.
5. Fungibility concerns: If CTV transactions stand out from regular transactions due to their distinctive structure, it could potentially harm Bitcoin's fungibility if they are treated differently by exchanges or other entities.
6. Wallet support: CTV requires specialized wallet software that can handle the creation and signing of covenant transactions. Not all wallets may support this functionality, limiting accessibility for some users.
7. Irreversibility: If a mistake is made in a CTV contract, such as sending funds to the wrong covenant address, it may be impossible to recover the funds since the spending conditions are enforced by the contract.
UTXO sharing with Bitcoin covenants like CheckTemplateVerify (CTV) can improve on-chain privacy in a few key ways:
1. Shared ownership of UTXOs: With CTV, multiple parties can jointly own a UTXO in a way where all their signatures are required to spend it. This makes it harder to trace ownership and spending to a single entity.
2. Obscured transaction graphs: When a UTXO is spent that had shared ownership via a covenant, it breaks deterministic links in the transaction graph. Outside observers can't easily connect the inputs and outputs, improving privacy.
3. Decoy inputs and outputs: CTV allows the creation of transactions with many decoy inputs and outputs not actually involved in the transfer of funds. This makes it much harder to determine the true sender, recipient, and amounts.
4. Concealing address reuse: Normally, reusing a Bitcoin address harms privacy by making it easier to link transactions. But with CTV, UTXOs can be spent back to the same covenant-controlled address without revealing that it's a reused address.
5. Privacy-enhancing protocols: CTV enables the trustless execution of privacy-focused smart contract protocols on Bitcoin like CoinSwaps, payment channels, atomic swaps, and certain forms of CoinJoins. These can leverage the UTXO-sharing capabilities of CTV.
So in summary, CTV allows a form of obfuscated, multi-party UTXO ownership that makes it very difficult to trace the flow of funds, link addresses, or determine true senders and recipients - providing a significant boost to on-chain privacy when used correctly in Bitcoin transactions and contracts. The privacy benefits compound as CTV adoption increases.
Coinbase has some of the worse withdrawal fees.
CTV has been discussed publicly for over 4 years, how long is enough? At what point does 'waiting for major consensus' look like bikeshedding? Waiting forever to upgrade also has tradeoffs that must be considered, it causes increased adoption and building of custodial solutions that undermine decentralization.
Bingo. Libertarianism is as utopian as socialism in that it presupposes a kind of uniform personality that does not exist in aggregate. We appear to be too stupid and selfish for such systems, and so it's not a reasonable prescription in practice. A crypto-maxarchy that seeks to create as many digital sovereigns as possible may be the only solution by carving out a cyber Galt's Gluch for the inventive low time preference minds to congregate and build.
Sure, Molly is an excellent guide, but she doesn't always unpack the personal stuff in the unconscious that tints our lens. Yage, wachuma and the other visionary ceremonial plants have a whole other dimension that can really change a person for the better, not just triage their trauma. Just my 2c of course, YMMV.
Ha. Do more entheogens.
On a scale of retarded to silly, where is this?
running a routing node as a Tor hidden service introduces 6 hops between the client and service. the increased latency, timeouts, and failure rates associated with just these 6 hops has been enough for routing nodes to forego allocating liquidity and serving clients over Tor
if the average number of routing node hops per lightning payment is something like 3-6, and if all routing nodes in the chain were to run as a hidden service instead of clearnet (which i think Leo is proposing here), then all of a sudden that's 18-36 hops, which would dramatically increase latency, timeouts, and failed requests
that said, just because there's an ungodly amount of hops doesn't mean it's not feasible. there's just no commercial incentive today since the market is so niche and operating an LSP - even over clearnet - hasn't been a particularly lucrative endeavor to date
congestion among the Tor network is also a factor, but incentivizing folks to run more Tor nodes would introduce a new set of regulatory risks that doesn't exist today, and i'm dubious that there exists a strong enough commercial incentive in the near-term
@nvk silly, awful, or both?
