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Segregated Witness: A Sneak-Peak into LinchPin of Lightning protocol

Segregated Witness: A Sneak-Peak into LinchPin of Lightning protocol

A basic understanding of the backbone of the lightning protocol.

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Ram Ganesh Lankada
·

2 min read

Table of contents

SEGREGATED WITNESS

  1. Solves the Problem of Malleability

    • Malleability refers to the modification of transaction ID's due to the presence of digital signatures.

    • This can lead to incorrect transactions if a third party makes changes to the ID and broadcasts it across the network.

  2. Two Types of Segwit

    • Segwit Wrapped within P2SH (address starts with '3')

    • Bech32 (BIP 176 - address starts with bc1)

  3. Segwit Address Types Starting with '3'

    • Segwit or Multi-Sig or Lightning Channel

    • Fingerprinting

    • Statistical Analysis

    • Taproot

    • Graftroot

  4. Using Segwit

    • Segwit Address

    • Segwit Structure

  5. Consequences of Transaction Malleability

    • Allows DDOS Attacks

    • Double Withdrawals

FURTHER EXPLORATIONS

  1. Assembly Data (ASM)

    • Doubly Hashed Public Key derived from Raw Data Hex

    • Locking Script gets hashed to ASM

    • Wire Shark and Interception Tools for attacking

    • SQL Injection, Cross Platform Scripting, CSRF

  2. To Know

    • Taproot

    • Zk-SNARKS

    • Segwit

    • Mimblewimble

    • Monero Ring Signatures

    • Regular Merge Mining

    • Blind Bridge Mining

    • Trampoline Routing

    • Rendezvous Routing

    • Tricks with HODL Invoices

    • Turbo Channels to push balances without getting the hashes delivered

    • Submarine Payments or Submarine Swaps (Atomic Swaps)

      • Emulating Main Net and Lightning Net Transactions

      • Coin Mixing Service Operators

      • Splicing Techniques (Splice In and Splice Out)

      • MESH network of payment channels to avoid transaction fees on Main Net

      • Neutrino (Lightweight Lightning Node)

    • Arguments against Lightning Network not working

      • NP-Hard Problem

      • Travelling Salesman Problem

      • Optimization Can't be Done

    • Types of Routing Algorithms

    • Streaming Money by Aantonop (Micro-Payments and Nano-Payments)

    • TOR Network

    • Problems with RSA (Computational Efficiency, Short Messages, Possible Attacks)

    • Fee Management Techniques

      • Replace by Fee

      • The child Pays for the Parent

    • Third Layer Networks

    • Graftroot

    • Merkleized Abstract Syntax Trees

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