Quote from: Abdussamad on February 02, 2014, 09:46:36 AM

Ok this is all nice and everything but could you please explain what n of m combination would be used? Take this for example:

https://www.realitykeys.com/blockchain/52/

Let's say that Alice wants to bet 10 millibits against Bob's 10 millibits that the address 1BitcoinEaterAddressDontSendf59kuE will have at least 2000 millibits on 03/23/2014.
They create two new events like these:
https://www.realitykeys.com/blockchain/89/
https://www.realitykeys.com/blockchain/90/

Let's say that Alice has a public address corresponding to the private key 5JNsUzxm5gyRybX5GLJ56ccWo45zFT7RPJDoBgffuqq8DiRh7fu and Bob has a public address corresponding to the private key 5KTqVVteW3cUAyXxerB5ho9mkMFg6LJ9ez5mnRx2zLPZsXaoiCD.
They will create two 2-of-4 multisig addresses.
The first one consists of the 2 public keys which realitykeys.com* will reveal if 1BitcoinEaterAddressDontSendf59kuE has less than 2000 millibits on 03/23/2014, the public key of Alice, and 1 public key which realitykeys.com will reveal if otherwise. This gives us the address 39X1TUG2bTJQ4SJ2HRjGMWewdXDoR4sm3R and the redeem script:

5241044bd2c100f5b52b54217a4b7a1356abe8352fef64edc440bede7f14793b79e79f967633189 796ca838cb43374563090136faa3a573bbbdcf3ce8b7130e30a439a41047ee78ee7ed1f7e0e50d3 c0585e4c695dc68a2503ba8a5343338cd72f962ca500d5aabd41577391294725379cb746cd5f614 381951739d17a73da34c2d134b941410448b9ec5366e8c4dfe9f5599c926220c3fc594ce9322f17 feaf28b59eba4f3ca3193d7a9da63ab975d9ba4642056ccc3c15657b8eb58ed6f45e6663bd8531b ffb4104501598839906e9782d3ea82afafd87839ae6e1dc34061bb17b196b4d9bf4b76bd0f20fe7 83d87d995e88774b940866a70b51323ad188aaffaf51ae30a865882b54ae

The second 2-of-4 address consists of the 2 public keys which realitykeys.com* will reveal if 1BitcoinEaterAddressDontSendf59kuE has at least 2000 millibits on 03/23/2014, the public key of Bob, and 1 public key which realitykeys.com will reveal if otherwise. This gives us the address 3MDaf2H76q849GPh45bFkm1smfWE5fij5n and the redeem script:

524104501598839906e9782d3ea82afafd87839ae6e1dc34061bb17b196b4d9bf4b76bd0f20fe78 3d87d995e88774b940866a70b51323ad188aaffaf51ae30a865882b41043801df383779f7edf643 f2f195239032ee00bdc58fe7dd059c72c3e65853c92e926abe11896c509f8d8baeabd7d7cec0709 5472baa9b231f5e6aab0e64ea06864104ef264df632bb21aed00bdd2fed565496cbd017cbb59e8c b3b303cf1ab065d42b7205b0c991c540f02620ac2dafbc0cb21d23f4192b68a08e218aed91ed59f 71c41044bd2c100f5b52b54217a4b7a1356abe8352fef64edc440bede7f14793b79e79f96763318 9796ca838cb43374563090136faa3a573bbbdcf3ce8b7130e30a439a54ae

Alice sends 10 millibits to the first address, Bob sends 10 millibits to the second one.

After 03/24/2014, if 1BitcoinEaterAddressDontSendf59kuE has at least 2000 millibits, 1 public key from the first 2-of-4 address will be revealed, and 2 public keys from the second address. Alice will be able send all 20 millibits to her own address. If 1BitcoinEaterAddressDontSendf59kuE has less than 2000 millibits, 2 public keys from the first 2-of-4 address will be revealed, and 1 from the second address. Bob will be able to send all 20 millibits to his own address.

The beauty of it is that there is no third party involved in storing the millibits. If Alice and Bob fear that realitykeys.com can steal their millibits, they can create 4-of-6 addresses, with 3 public keys from Alice and Bob and the already mentioned 3 from realitykeys.com. This way even the guys from the website will not be able to touch the millibits.

*realitykeys.com shows the public keys in compressed form. In order to get the uncompressed addresses in hex, needed to create multi-sig addresses here, you can use the Bitcoin Address Utility by Casascius. You need to go to Tools > Address Utility > paste in Public Key Hex > click Publick Key > Uncompress Public Key.

edlund

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