147 sats \ 2 replies \ @supertestnet OP 23 Jul \ on: StatechainJS: fast & free bitcoin transactions -- like ecash but a bit safer bitcoin
It didn't occur to me until today but statechains have one very meaningful privacy advantage over ecash, which is this: an ecash mint can do "shotgun kyc" on its users by telling them, "I will not permit any more transfers or withdrawals unless you first submit your identification documents at this website <insert_chainalysis.com_equivalent_here>."
But if a statechain operator tried that, users could laugh in his face and use their already-signed unilateral withdrawal transactions to leave him behind forever. Protection from "shotgun kyc" seems to give statechains yet another advantage over ecash mints: you can leave without the operator's help, and you can dodge privacy invasions better than you can with ecash. Statechains FTW!
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For the sake of those who didn't see the other comments, let me elaborate:
Unlike ecash mints, which have full custody of your money, the only way a statechain operator can rob you is through a doublespend -- they can help someone "take back" money that they sent you. But if some authority figure demanded that a statechain operator confiscate coins from folks who don't kyc, they cannot help with that except if they first prepared a doublespend attack on every user.
Imagine this unlikely scenario: a government sleeper agent wants statechain user Ahmed to do kyc. The sleeper agent prepares to send a coin to Ahmed, but before doing so he convinces (or strong arms) the operator to setup a doublespend scenario. Namely, the sleeper agent modifies his software before sending his coin to Ahmed so that he can keep its private key after sending it. He also makes the statechain operator modify their software too to keep their private key. Then he sends Ahmed the coin. In this circumstance, the sleeper agent could threaten Ahmed to either do shotgun kyc or face the consequence: the sleeper agent will confiscate that one single coin. But that would be super weird, why would the government go through all the trouble of setting up a scenario where they can doublespend one suspect when they could just never send that person money in the first place? And would they really have the means to prepare and carry out that attack on every single user?
I don't think that scenario is realistic, so statechain users are almost entirely immune from the threat of shotgun kyc, whereas ecash users are not. Since it's impractical for an operator to steal (except via a doublespend), they also can't make the threat "I will steal your coins unless you do kyc!" which is all shotgun kyc really is.
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