[Lightning-dev] Dynamic Commitments Part 2: Taprooty Edition

[Olaoluwa Osuntokun]

Oh one other thing I forgot to mention is that switching over the _existing_
channels using w/e update protocol presents an accelerated path to
taproot/PTLC for the existing channels, as they don't necessarily need any
new gossip announcement messages. Instead, after making the switch over,
they can start to advertise the new relevant set of feature bits for
PTLC-like stuff.

This gives us a bit more freedom as moving the existing channels over to
taproot isn't necessarily blocked on deciding which path we want to go re
channel announcement evolution.

-- Laolu


On Thu, Mar 24, 2022 at 3:52 PM Olaoluwa Osuntokun <laolu32 at gmail.com>
wrote:

> Hi y'all,
>
> ## Dynamic Commitments Retrospective
>
> Two years-ish ago I made a mailing list post on some ideas re dynamic
> commitments [1], and how the concept can be used to allow us to upgrade
> channel types on the fly, and also remove pesky hard coded limits like the
> 483 HTLC in-flight limit that's present today. Back then my main target was
> upgrading all the existing channels over to the anchor output commitment
> variant, so the core internal routing network would be more resilient in a
> persistent high fee environment (which hasn't really happened over the past
> 2 years for various reasons tbh). Fast forward to today, and with taproot
> now active on mainnet, and some initial design work/sketches for
> taproot-native channels underway, I figure it would be good to bump this
> concept as it gives us a way to upgrade all 80k+ public channels to taproot
> without any on chain transactions.
>
> ## Updating Across Witness Versions w/ Adapter Commitments
>
> In my original mail, I incorrectly concluded that the dynamic commitments
> concept would only really work within the confines of a "static" multi-sig
> output, meaning that it couldn't be used to help channels upgrade to future
> segwit witness versions.  Thankfully this reply [2] by ZmnSCPxj, outlined a
> way to achieve this in practice. At a high level he proposes an "adaptor
> commitment" (similar to the kickoff transaction in eltoo/duplex), which is
> basically an upgrade transaction that spends one witness version type, and
> produces an output with the next (upgraded) type. In the context of
> converting from segwit v0 to v1 (taproot), two peers would collaboratively
> create a new adapter commitment that spends the old v0 multi-sig output,
> and
> produces a _new_ v1 multi-sig output. The new commitment transaction would
> then be anchored using this new output.
>
> Here's a rough sequence diagram of the before and after state to better
> convey the concept:
>
>   * Before: fundingOutputV0 -> commitmentTransaction
>
>   * After fundingOutputV0 -> fundingOutputV1 (the adapter) ->
>     commitmentTransaction
>
> It *is* still the case that _ultimately_ the two transactions to close the
> old segwit v0 funding output, and re-open the channel with a new segwit v1
> funding output are unavoidable. However this adapter commitment lets peers
> _defer_ these two transactions until closing time. When force closing two
> transactions need to be confirmed before the commitment outputs can be
> resolved. However, for co-op close, you can just spend the v0 output, and
> deliver to the relevant P2TR outputs. The adapter commitment can leverage
> sighash anyonecanpay to let both parties (assuming it's symmetric) attach
> additional inputs for fees (to avoid introducing the old update_fee related
> static fee issues), or alternatively inherit the anchor output pattern at
> this level.
>
> ## Existing Dynamic Commitments Proposals
>
> Assuming this concept holds up, then we need an actual concrete protocol to
> allow for dynamic commitment updates. Last year, Rusty made a spec PR
> outlining a way to upgrade the commitment type (leveraging the new
> commitment type feature bits) upon channel re-establish [3]. The proposal
> relies on another message that both sides send (`stfu`) to clear the
> commitment (similar to the shutdown semantics) before the switch over
> happens. However as this is tied to the channel re-establish flow, it
> doesn't allow both sides to do things like only allow your peer to attach N
> HTLCs to start with, slowing increasing their allotted slots and possibly
> reducing them (TCP AIMD style).
>
> ## A Two-Phase Dynamic Commitment Update Protocol
>
> IMO if we're adding in a way to do commitment/channel upgrades, then it may
> be worthwhile to go with a more generalized, but slightly more involved
> route instead. In the remainder of this mail, I'll describe an alternative
> approach that would allow upgrading nearly all channel/commitment related
> values (dust limit, max in flight, etc), which is inspired by the way the
> Raft consensus protocol handles configuration/member changes.
>
> For those that aren't aware, Raft is a consensus protocol analogous to
> Paxos
> (but isn't byzantine fault tolerant out of the box) that was designed as a
> more understandable alternative to Paxos for a pedagogical environment.
> Typically the algorithm is run in the context of a fixed cluster with N
> machines, but supports adding/removing machines from the cluster with a
> configuration update protocol. At a high level the way this works is that a
> new config is sent to the leader, with the leader synchronizing the config
> change with the other members of the cluster. Once a majority threshold is
> reached, the leader then commits the config change with the acknowledged
> parties using the new config (basically a two phase commit). I'm skipping
> over some edge cases here that can arise if the new nodes participate
> consensus too early, which can cause a split majority leading to two
> leaders
> being elected.
>
> Applying this to the LN context is a bit simpler than a generalized
> protocol, as we typically just have two parties involved. The initiator is
> already naturally a "leader" in our context, as they're the only ones that
> can do things like trigger fee updates.
>
> ### Message Structure
>
> At a high level I propose we introduce two new messages, with the fields
> looking something like this for `commitment_update_propose`:
>  * type: 0 (`channel_id`)
>    * value: [`32*byte`:`chan_id`]
>  * type: 1 (`propose_sig`)
>    * value: [`64*byte`:`sig`]
>  * type: 2 (`update_payload`)
>    * value: [`*byte`:`tlv_payload`]
>
> and this `commitment_update_apply`:
>  * type: 0 (`channel_id`)
>    * value: [`32*byte`:`chan_id`]
>  * type: 1 (`local_propose`)
>    * value: [`*byte`:`commitment_update_propose`]
>  * type: 2 (`remote_propose`)
>    * value: [`*byte`:`commitment_update_propose`]
>
> ### Protocol Flow
>
> The core idea here is that either party can propose a commitment/channel
> param update, but only the initiator can actually apply it. The
> `commitment_update_propose` encodes the new set of updates, with a
> signature
> covering the TLV blob for the new params (more on why that's needed later).
> The `commitment_update_apply` includes up to _two_
> `commitment_update_propose` messages (one for the initiator and one for the
> responder, as nested TLV messages). The `commitment_update_propose` message
> would be treated like any other `update_*` message, in that it takes a new
> commitment signature to properly commit/apply it.
>
> The normal flow takes the form of both sides sending a
> `commitment_update_propose` message, with the initiator finally committing
> both by sending a `commitment_update_apply` message. In the event that only
> the responder wants to apply a param change/update, then the initiator can
> reply immediately with a `commitment_update_apply` message that doesn't
> include a param change for their commitment (or they just echo the
> parameters if they're acceptable).
>
> ### Handling Retransmissions
>
> The role of the signature it to prevent "spoofing" by one of the parties
> (authenticate the param change), and also it serves to convince a party
> that
> they actually sent a prior commitment propose update during the
> retransmission phase. As the `commitment_update_propose` message would be
> retransmitted like any other message, if the initiator attempts to commit
> the update but the connection dies, they'll retransmit it as normal along
> with their latest signature.
>
> ### Nested TLV Param Generality
>
> The messages as sketched out here just have an opaque nested TLV field
> which
> makes it extensible to add in other things like tweaking the total number
> of
> max HTLCs, the current dust values, min/max HTLCs, etc (all things that are
> currently hard coded for the lifetime of the channel). An initial target
> would likely just be a `chan_type` field, with future feature bits
> governing
> _what_ type of commitment updates both parties understand in the future.
>
> In the past, when ideas like this were brought up, some were concerned that
> it wouldn't really be possible to do this type of updates while existing
> HTLCs were in flight (hence some of the ideas to clear out the commitment
> beforehand). I don't see a reason why this fundamentally _shouldn't_ be
> allowed, as from the point of view of the channel update state machine, all
> updates (adds/removes) get applied as normal, but with this _new_
> commitment
> type/params. The main edge case we'll need to consider is cases where the
> new params make older HTLCs invalid for some reason.
>
> ## Conclusion
>
> Using the adapter commitment idea combined with a protocol for updating
> commitments on the fly, would potentially allow us to update all 80k+
> segwit
> v0 channels to the base level of taprooty channels without any on chain
> transactions. The two transactions (open+close) must happen eventually, but
> by holding another layer of spends off-chain we can defer them (potentially
> indefinitely, as we have channels today that have been opened for over a
> year).
>
> Deploying a generalised on-the-fly dynamic commitment update protocol gives
> us a tool to future proof the _existing_ anchored multi-sig outputs in the
> chain, and also a way to remove many of the hard coded parameters we have
> today in the protocol. One overly inflexible parameter we have today in the
> network is the 483 HTLC limit. Allowing this value to float would allow
> peers to apply similar congestion avoidance algorithm that are used in TCP
> today, and also give us a way to protect the network against future
> unforeseen widespread policy changes (like a raising of the dust limit).
>
> -- Laolu
>
> [1]:
> https://lists.linuxfoundation.org/pipermail/lightning-dev/2020-July/002763.html
> [2]:
> https://lists.linuxfoundation.org/pipermail/lightning-dev/2020-July/002770.html
> [3]: https://github.com/lightning/bolts/pull/868
>
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