We cannot use CLTV for proof of burn, because it would allow miners to cheat. This is explained in the whitepaper: https://notary.electrum.org/n/proof-of-burn.pdf (see footnote on page 4)
Login to reply
Replies (3)
So you're saying that miners would delay the notarization transaction until the height specified in the CLTV, so that they can notarize and redeem in the same block
Yes, they could in theory, and that would allow the cheating that we discussed before. But they're not going to delay the notarization transaction for decades, if we're sending it decades into the future
The end users of the system (I mean the users of nostr clients who are consuming nostr events and want to see which events have burned sats associated with them) are looking for reliable notaries, i.e. notaries that get the notarizing transactions into blocks within hours or days (not years or decades).
The end user's software could easily check that the notarization transaction is mined at least N blocks before whichever height is specified/implied by the CLTV or CSV locks
It's not about delaying the transaction. If you only rely on CLTV, a spammer can mine a notarization transaction today and pretend that it has been published a long time ago.
But you are right, the software could additionally check that the notarization was mined N blocks before the locktime. This introduces an extra parameter, and it feels a bit like misusing CLTV, but it would indeed allow for longer time delays than CSV.
The extreme case of this could be very interesting for game theory, leading to just one notary getting a very large monopoly
Imagine a single notary does a deal with all the big mining pools which together control 90% of hashrate
That notary could advertise: "give me 10 sats and I'll notarise it as 50 sats".
As they control 90% of hashrate, they will on average get 45 sats back from those 50, and hence the real cost to the notary is just 5 sats (on average) compared to the 10 sats that they earn from the creator of the nostr content
With CSV, the delay is just about 15 months, and that's short enough that the big notary is happy to wait
I think the only solution is to really make sure that today's miners don't see any value from the burning, so either notarizing to an OP_RETURN, or use CLTV to send it very far in the future
@c03rad0r , is this the right npub for Espen?: @Espen I think he had the same idea