Quote from: abhutra on July 30, 2018, 07:21:03 AM

eltoo: A Simplified Update Mechanism for Lightning and Off-Chain Contracts

https://blockstream.com/2018/04/30/eltoo-next-lightning.html

Would love to discuss more/ what do you guys think?

I have read the associated Reddit discussion and I still have a doubt about eltoo.

The question arose at Reddit, too: What could be done to prevent that scam hubs simply keep trying to broadcast old channel states? There is no penalty for that behavior at this protocol level, according to Christian Decker.

But how could a penalty be implemented on a "higher level", like Decker says in some moment in the discussion? I think a form of penalty is necessary, otherwise it will become a huge scamfest, or the system will depend excessively on watchtowers and other third parties. I'm afraid that in this case LN would be sort of losing its elegance.

I would be grateful for an example for a higher level penalty implementation understandable by someone who has no IT degree Wink

Decker posted this explanation at Reddit, but I need some clues still:

Quote

Re-introducing the asymmetry at a higher level allows us to select how much of the channel we'd like to set aside for a punishment for example. Have the reserve split out into a separate output of the settlement transaction and encumbering it with a shachain or elkrem preimage. This is similar to the current mechanism of ensuring that all parties have some skin in the game.

The second sentence - the core of his proposal - is difficult for me to understand. Embarrassed