nostr:nprofile1qqs9pk20ctv9srrg9vr354p03v0rrgsqkpggh2u45va77zz4mu5p6ccpz4mhxue69uhhyetvv9ujuerpd46hxtnfduhsz9thwden5te0dehhxarj9ehhsarj9ejx2a30qyg8wumn8ghj7mn0wd68ytnddakj7xph5zr
I’ve been thinking about extending the Cashu architecture by integrating mint services with LSP services (similar to zeus and breez) as a custodial solution for seamless onboarding into bitcoin without upfront fees. This approach uses Cashu Bitcoin tokens to initially onboard with custodying through the Cashu mint, allowing the user to eventually accumulate enough bitcoin to open their own Lightning channels.
By integrating an LSP (Lightning Service Provider) directly into the Cashu mint, we allow users to not only manage tokens but also benefit from self-custody of private lightning channels. The Cashu mint would essentially act as both a mint and an LSP, offering more incentives for honest operation (given the profitability of fees from both Lightning transactions and channel openings).
This dual functionality also enables zero-fee Lightning transactions between the wallet and the mint, making the user experience more seamless. Instead of requiring users to store tokens themselves, the mint could process these tokens immediately as Lightning payments to the wallet's channel, reducing custody overhead and eliminating onboarding fees.
The real innovation here is in the user journey. By accumulating Cashu tokens, a user could eventually open their own Lightning channel with minimal cost and hold their own keys. This system offers an easy path to self-custody while reducing the barriers to entry—giving Cashu mint more flexibility and financial incentives while users get lower fees and better security.
By offering liquidity provisioning for a fee on the mint’s side, we can create bidirectional channels, enhancing the overall Lightning experience for users. The potential for this integrated approach could reshape how we view custodial Lightning solutions, providing a clear path from onboarding to self-custody.
Would love to hear your thoughts on this. Could this architecture align with the broader vision of the Cashu protocol and Lightning adoption?
#minibits #cashu #ecash #enuts
(No I don't use telegram)
Here are two high-level architectural approaches for a Chaumian eCash system that maximize privacy, simplicity, and monetary qualities, while ensuring that the token is independent of the mint for redemption once issued. The focus will be on creating an eCash system where the token holder can redeem or transfer the token without relying on the mint’s continued operation, while maintaining the option to refresh the token through the mint for privacy purposes.
Approach 1: Pre-Signed Taproot UTXO System
Key Elements:
Taproot-based UTXO redemption
Blind signatures for token issuance and refresh
Pre-signed UTXO for independence from the mint
Architecture Overview:
1. Token Minting and Issuance:
The mint issues an eCash token using a Chaumian blind signature protocol to ensure privacy. The mint does not know which user receives which token.
The token is backed by a pre-signed Taproot UTXO. The UTXO is constructed in such a way that the token holder (or any subsequent holder) can redeem the UTXO on-chain without further interaction with the mint.
The Taproot UTXO includes a multisignature or hash-time-locked contract (HTLC) that allows redemption by the current token holder while preserving privacy and independence from the mint.
2. Token Transfer:
The token is transferable off-chain. When the token is transferred, the recipient inherits the ability to redeem the UTXO associated with the token.
To transfer the token, the current holder generates a blind signature request for the recipient. This signature does not reveal the recipient's identity to the mint, preserving privacy.
The transfer updates the necessary Taproot conditions (e.g., the hash-lock or multisignature) to reflect the new ownership, ensuring that only the new holder can redeem the UTXO.
3. Token Redemption:
The token holder can choose to redeem the token for Bitcoin directly by spending the pre-signed Taproot UTXO.
The Taproot UTXO is structured to provide multiple redemption conditions, such as a timelock or a fallback clause in case certain conditions are not met. For example, if the UTXO is not redeemed after a certain period, it could revert to a more general redeemable state for the token holder.
4. Token Refresh:
For additional privacy, the token holder may prefer to refresh the token by returning it to the mint and receiving a new eCash token in return. This refresh process uses the Chaumian blind signature protocol to ensure that the mint cannot link the old and new tokens to the same user.
Advantages:
Privacy: The use of Taproot and Chaumian blind signatures ensures strong privacy both when the token is issued and when it is transferred. The mint does not know which token is associated with which user.
Simplicity: The system relies on the relatively simple mechanics of pre-signed UTXOs combined with Taproot conditions, making it efficient to implement and execute on the Bitcoin blockchain.
Independence from Mint: Once the token is issued, the pre-signed UTXO ensures that the token holder can redeem the Bitcoin without needing the mint’s continued involvement.
Monetary Qualities: The token is backed by Bitcoin (via the UTXO), ensuring scarcity, durability, and divisibility, which are essential for a monetary good.
---
Approach 2: Scriptless Script and Schnorr-Based Payment System
Key Elements:
Scriptless scripts for off-chain contracts
Schnorr-based signatures for multisignature control
Hash-time-locked contracts (HTLCs) for flexibility
Architecture Overview:
1. Token Minting and Issuance:
The mint issues the eCash token using a Chaumian blind signature. The token is tied to a Schnorr-based multisignature contract or scriptless script, which ensures that the holder can redeem the token either for Bitcoin on-chain or through a Lightning-like payment.
The key idea here is to use scriptless scripts, which keep the contract logic off-chain while ensuring that the conditions for redeeming the token remain valid without further interaction with the mint.
2. Token Transfer:
The token can be transferred using an off-chain scriptless contract between the current holder and the new recipient. The Schnorr multisignature setup allows for a smooth transition of ownership without revealing any on-chain details.
Upon transfer, the new holder inherits the conditions needed to redeem the token for Bitcoin. The scriptless nature of the contract ensures that no on-chain complexity is added during the transfer.
The token holder generates a new Schnorr signature for the new recipient, updating the conditions of the multisignature contract without the involvement of the mint.
3. Token Redemption:
The token holder can redeem the token either:
On-chain: By fulfilling the conditions of the Schnorr-based contract or HTLC, the holder can trigger a Bitcoin payout directly from the blockchain.
Off-chain (Lightning-like): If the token is tied to a hash-time-locked contract (HTLC) that mirrors the Lightning Network’s structure, the holder can redeem the token off-chain for sats without going through the blockchain.
The redemption process is trustless, meaning that the mint is not needed for the token holder to redeem the value of the token.
4. Token Refresh:
For privacy reasons, the token holder may wish to return the token to the mint to receive a fresh token. This refresh process again uses Chaumian blind signatures to ensure that the mint cannot track or link the old and new tokens.
Advantages:
Privacy: Scriptless scripts combined with Schnorr signatures ensure that the transfer and redemption process remains private, as the contract logic is kept off-chain and the mint has no visibility into individual transactions.
Simplicity: By using scriptless scripts, the system avoids the complexity of on-chain smart contracts while maintaining the flexibility and privacy of conditional transactions.
Independence from Mint: Once the token is issued, the Schnorr-based contract or HTLC ensures that the holder can redeem the token independently of the mint.
Monetary Qualities: The token is redeemable for Bitcoin, ensuring that it inherits Bitcoin’s scarcity and durability. Scriptless scripts maintain privacy and security in the process.
---
Conclusion:
Both approaches focus on maximizing privacy, simplicity, and monetary qualities while ensuring that the token remains independent of the mint after issuance:
1. Pre-Signed Taproot UTXO System:
This approach uses Taproot and pre-signed UTXOs to provide a straightforward, privacy-preserving way for the token holder to redeem Bitcoin on-chain. It maximizes simplicity and monetary qualities by directly tying the token to Bitcoin UTXOs.
2. Scriptless Script and Schnorr-Based Payment System:
This approach leverages scriptless scripts and Schnorr signatures to create flexible, off-chain contracts that maintain privacy and independence. It maximizes flexibility and privacy through the use of Schnorr multisignature contracts and HTLCs.
In both cases, the Chaumian blind signature protocol ensures privacy at the minting and token refresh stages, while the use of Taproot or scriptless scripts ensures that the token can be redeemed independently of the mint’s operation, maximizing privacy and security for the user.
#ecash #cashu #fedimint
Showing page 1 of
15 pages
