:: Re: [unSYSTEM] DarkWallet Best Prac…
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Autor: Amir Taaki
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A: Amir Taaki
CC: unsystem, bitcoin-development
Assumpte: Re: [unSYSTEM] DarkWallet Best Practices
About signing each commit, Linus advises against it:

http://git.661346.n2.nabble.com/GPG-signing-for-git-commit-td2582986.html

"Btw, there's a final reason, and probably the really real one. Signing
each commit is totally stupid. It just means that you automate it, and you
make the signature worth less. It also doesn't add any real value, since
the way the git DAG-chain of SHA1's work, you only ever need _one_
signature to make all the commits reachable from that one be effectively
covered by that one. So signing each commit is simply missing the point."

What do you reckon?

Also do you approve of the other link I sent you?

https://wiki.unsystem.net/index.php/DarkWallet/Negotiation

> I've put it here:
>
> https://wiki.unsystem.net/index.php/DarkWallet/Best_practices
>
> Will clean it up and make modifications over time.
>
>> Here's my draft. I don't claim this to be "official", but I think this
>> should represent the consensus we've come to at the DarkWallet
>> Hackathon; I'm writing it up as an email in part to preserve a record of
>> that consensus.
>>
>>
>> * General Principles
>>
>> We believe in decentralization, user-defined privacy, education as
>> opposed to "magic", and security based on openness rather than just
>> trust. We consider users who are individuals as well as the needs of
>> businesses such as merchants and exchanges. We recognize that often the
>> more people who use privacy protection technologies such as CoinJoin,
>> the better protected we all are.
>>
>>
>> * Privacy
>>
>> Bitcoin inherently makes the flow of money visible, however it does not
>> require that flow to have real-world identities attached, or even for
>> that matter, pseudonyms. We see this as an unfortunate flaw in the
>> Bitcoin protocol that is to be corrected; the Satoshi whitepaper itself
>> included one such correction by outlining how avoiding address re-use
>> helped preserve privacy.
>>
>>
>> ** Threat model
>>
>> We assume a worst-case sophisticated state-level attacker with the goal
>> of deanonymizing and otherwise subverting Bitcoin users. Such an
>> attacker can be assumed to control up to 100% of the Bitcoin relay
>> network as well as have the ability to wiretap up to 100% of the
>> node-to-node traffic. (for nodes that they do not control) Such
>> attackers are however constrained by politics and budget. We assume they
>> use their ability to conduct MITM attacks sparingly - for instance by
>> subverting certificate authorities - due to the risk of detection. (note
>> how such attackers may be more willing to use detectable attacks in the
>> future now that their activities are public knowledge) We also assume
>> that while their budgets for individual targets may be very large, the
>> equally large number of targets required for en-mass survailance leads
>> to relatively low budgets per target. In particular note how the 51%
>> assumption assumes that the overall "economic value" of Bitcoin to its
>> participants is greater than the attacker's budget by some margin.
>>
>>
>> ** Address re-use
>>
>> Wallet software SHALL avoid address re-use. New addresses will be used
>> for all change and users will be encouraged through the user-interface
>> and other measures to use new addresses for every payment to the wallet.
>>
>>
>> ** CoinJoin
>>
>> With CoinJoin the more users that make use of it, the larger the
>> anonymity set and the better protected user privacy is. Thus we
>> encourage wallet software to agressively make trade-offs between
>> absolute privacy and usability; compromise is not a dirty word.
>>
>> Wallet software SHALL implement basic two-party mix functionality and
>> MAY implement more sophisticated CoinJoin functionality such as n-party
>> mixes. CoinJoin SHALL be the default way that all transactions are sent.
>> Wallet authors are cautioned that more sophisticated functionality may
>> be more secure in theory, but if users do not use it the functionality
>> is wasted; focus on the general case first and only then try to improve.
>>
>>
>> *** Two-Party Mixes
>>
>> The most basic form of CoinJoin is for two parties to author a
>> transaction. A key distinction between a 2 party mix and an n-party mix
>> is that in the two party case both parties automatically learn the
>> other's inputs and outputs by simple elimination; sophisticated
>> cryptographic blinding protocols are useless. To an external attacker
>> each transaction doubles the size of the anonymity set: the coins may
>> have come from one party or the other and the attacker has no way of
>> knowing which. (modulo value analysis, which will be discussed later)
>>
>>
>> *** n-party Mixes and Blinding
>>
>> If two parties can jointly author a transaction, n parties can too.
>> Without special effort this has the disadvantage of revealing the input
>> to output mapping to all parties. Various cryptographic blinding schemes
>> have been proposed to fix this problem, either with multi-party
>> computational techniques, or by making use of multiple communication
>> channels along with a robust anti-DoS scheme. In either case, for now we
>> reject such schemes as complex and inconvenient and prioritize robust
>> two-party mixing. However we do take the existance of such schemes into
>> account; note how a n-party mix can act as a single party in a two-party
>> mix scheme.
>>
>>
>> *** Four-stage two-party mix protocol
>>
>> <on the wiki>
>>
>>
>> *** Defeating value analysis
>>
>> Attackers can make good guesses at the mapping of inputs to outputs
>> based on value. For instance with two inputs of 3 and 5, and fours
>> outputs of 1.4, 1.6, 2.4 and 2.6 the attacker can easily map inputs to
>> outputs based on what values match up, in this case 3 split into 1.6 and
>> 1.4, and 5 split into 2.4 and 2.6
>>
>>
>> **** Value Matching
>>
>> Not all CoinJoin users need their transactions to have specific output
>> amounts; some users simply need to move money from one place to another
>> but do not need a specific amount moved or at a specific time. These
>> users can assist users with more stringent requirements by matching the
>> input or output values they request. As a general principle wallets
>> SHOULD make these anonymity optimizations possible by allowing users to
>> schedule transactions to complete by a specific time and/or allow users
>> to specify that they do not wish the transaction to happen unless
>> CoinJoin is used.
>>
>> With four-stage two-party mixes the Alice, who advertised a desire to do
>> a transaction first, can easily do ths by picking the transaction output
>> amounts only after Bob replies with his desired inputs and outputs, and
>> picking those amounts so they match Bob's. (or some combination of Bob's
>> outputs)
>>
>>
>> **** Merge Avoidance
>>
>> Merge avoidance is the practice of avoiding the merging of multiple
>> transaction inputs into a single new transaction output, thus implying a
>> common relationship between those inputs. The most primitive form of
>> merge avoidance is to create multiple individual transactions, each
>> moving single transaction input to an output. (or perhaps some small
>> number) This is of course inefficient, and appears to have only been
>> proposed as a means to still allow for coin blacklists to function while
>> preserving some financial privacy.
>>
>> Combined with CoinJoin however merge avoidance becomes much more
>> powerful. For instance even in its most simple form multiple parties can
>> combine their merge-avoiding transaction sets, giving even transactions
>> without actual counterparties a useful measure of plausible deniability.
>>
>> In addition the underlyng features that make merge-avoidance possible -
>> the ability of a recipient to designate they are willing to receive
>> payments made to multiple addresses - synergisticly make very
>> sophisticated value matching strategies possible.
>>
>>
>> ***** Cut-thru payments
>>
>> Related to merge avoidance the idea of a cut-thru payment is that if an
>> intermediary is both a debitor and a creditor, with sophisticated
>> payment protocols they can request incoming payments to directly pay
>> outgoing liabilities, skipping them as an intermediary. While premature
>> to implement this feature now, it is worth thinking about for the
>> future.
>>
>>
>> ** Tor
>>
>> While Tor isn't perfect there is real-world evidence - specifically the
>> Snowden leaks - that it works well enough to be considered a worthy
>> adversary by state-level attackers. Wallets MUST suppoort the basic
>> proxy options that allow the Tor proxy - or some other similar
>> technology - to be used for privacy enhancement and SHOULD make use of
>> Tor-specific features such as hidden services.
>>
>>
>> * Decentralization
>>
>> ** Fees
>>
>> In a decentralized system distinguishing DoS attackers from legitimate
>> users is at best difficult, at worst impossible. Wallets that do not
>> provide users with the ability to set fees, both when a transaction is
>> created initially and after initial broadcast, do their users a
>> disservice by taking away a vital method of responding to an attack:
>> outspending the attacker.
>>
>> Wallets MUST give users the ability to set the fee per KB they are
>> willing to pay for their transactions. Wallets SHOULD allow users to
>> change that fee after the fact via transction replacement. Wallets MAY
>> additionally implement fee estimation techniques, such as watching what
>> transactions in the mempool are finally mined, or using estimates
>> provided by miners. However it must be recognized that such data is
>> inherently unreliable, and this may become a problem in practice in the
>> future; giving users robust ways to alter fees after the fact will make
>> lying about fee data - perhaps to push fees upwards - less advantageous.
>>
>> Note that the current direction of the Bitcoin Foundation maintained
>> reference implementation is weakly towards a pure estimation scheme;
>> deployment of full nodes supporting replacement and support from miners
>> is a precondition to doing things correctly.
>>
>>
>> *** Fees and privacy
>>
>> Where there is a trade-off between fees and privacy - such as with merge
>> avoidance strategies - users should be given options to specify how much
>> extra they are willing to pay for extra privacy. Wallets SHOULD default
>> to being willing to pay some extra, perhaps 25% more over the basic fee.
>>
>>
>> ** SPV, full nodes and partial nodes
>>
>> Wallet software SHOULD whenever possible blur the distinctions between
>> full UTXO set nodes, SPV nodes, and partial UTXO set nodes. In addition
>> to those three basic categories there is also the question of whether or
>> not a node stores archival blockchain data, something that all three
>> categories of nodes can participate in.
>>
>> Instead how a node contributes back to the health of the network should
>> be a function of what resources it has available to it. Of course in
>> some cases, like a phone wallet, that won't be very much, but for
>> desktop or business usage the resources available can be significant in
>> both bandwidth and storage capacity.
>>
>>
>> *** Relaying data
>>
>> **** Blocks and blockheaders
>>
>> Any node can safely relay blocks and block headers, where "safely" is
>> defined as SPV-level security. Our threat model implies that we don't
>> trust random peers on the network, thus we are not relying on them for
>> block validity; as a SPV node we are relying on miners to do validity
>> checking for us. In short feel free to relay data that you yourself
>> would trust.
>>
>>
>> **** Transactions
>>
>> Remember that relaying transactions has a DoS-attack risk; the Bitcoin
>> model relies entirely on mining fees and/or priority as the limited
>> resource to prevent DoS attacks. Thus at present nodes SHOULD NOT relay
>> transactions if they do not have an up-to-date copy of the relevant
>> parts of the UTXO set spent by the transaction. (relaying transactions
>> spending only inputs in a partial UTXO set is acceptable):
>>
>>
>> **** Block-header diversity
>>
>> Wallet software MUST make it possible to get block-header information
>> from a diverse set of sources. These sources SHOULD comprise more than
>> just peers on a single P2P network. Remember that it is acceptable to
>> use even centralized sources in addition to decentralized ones for
>> blockheader data - knowing that a miner did the work required to create
>> a block header is always valuable information. (for reasonable amounts
>> of work) For instance the author's block headers over twitter project -
>> while an April Fools joke - is equally a perfectly reasonable backup
>> source of blockheader data.
>>
>>
>> ** Updating wallets from blockchain data
>>
>> In an ideal world wallets wouldn't need to sync their state with
>> blockchain data at all: pervasive use of payment protocols would have
>> senders send txout proofs directly to recipients. But that's not the
>> case. Instead wallet implementations sync themselves from the
>> blockchain, and when bandwidth limited this becomes a tradeoff between
>> bandwidth and privacy: your transactions hide in the anonymity set of
>> the false positives matched by the filter.
>>
>>
>> *** Bloom filters
>>
>> The current implementation for SPV nodes is to simply give peers a bloom
>> filter; the false-positives make the anonymity set. For n peers this has
>> O(n) cost when a new block comes in; Bloom filters are cheap to test
>> against and this system works reasonably well.
>>
>> However, for archival blockchain data bloom filters are seriously
>> flawed: every block has to be read from disk in full, the bloom filter
>> matched, and some (potentially very small!) subset sent to the peer. n
>> peers. The result is high IO load on the node relative to the client,
>> enabling easy DoS attacks.
>>
>> Wallet software SHOULD NOT implement only Bloom filters, however using
>> them when availalbe is acceptable. Note how the Bloom filter design has
>> at best O(n^2) scaling ruling it out for large-blocksize future
>> scenarios.
>>
>>
>> *** Prefix filters
>>
>> TXO or UTXO data can be easily indexed by in radix trees with log2(k)
>> lookup cost per query. We can take advantage of the fact that the query
>> keys need not be provided in full by only providing partial keys.
>> Because scriptPubKeys are randomly distributed a prefix n bits long has
>> an anonymity set of roughly 1/2^n * # of transactions in total.
>>
>> Wallet software SHOULD implement prefix filters and SHOULD use them in
>> preference to bloom filters whenever available. Wallet software that
>> currently uses full-key filtering - e.g. Electrum - MUST be upgraded to
>> support prefix filters in the future.
>>
>> Wallet software MUST NOT assume that matching anyting other than
>> H(scriptPubkey) is possible. This applies to bloom filter matches as
>> well.
>>
>> In the future miners may commit to either the TXO set in conjunction
>> with per-block lookup trees, or possibly the full UTXO set. In either
>> case many of the leading designs may be implemented with only
>> H(scriptPubKey) lookup capability for reasons of scalability.
>>
>>
>> * Security
>>
>> Bitcoin wallet software is unprecedented in how they provide attackers
>> targets that are highly profitable to attack and highly liquid. (note
>> the irony here!) A succesfull attack that injects malicious theft
>> routines into either sourcecode or binaries can steal thousands of
>> Bitcoins in one go, and the attacks target is you and your team.
>> Following basic good practices for robust code is a start, but it's far
>> from enough.
>>
>>
>> ** Source-code integrity
>>
>> Sourcecode MUST be maintained using a revision control system that
>> provides strong integrity guarantees; git is recommended.
>>
>> Sourcecode MUST be PGP signed on a regular basis. Releases MUST be
>> signed - in git this is accomplished by signing the release tag.
>> Individual commits SHOULD be signed, particularly if source-code used in
>> day-to-day development is kept on an untrusted server, e.g. github.
>> Recovering from a server compromise is made significantly easier if
>> every commit is securely signed.
>>
>>
>> ** Binary integrity
>>
>> All things being equal it is better to use an interpreted language
>> rather than a compiled one; auditing the former is significantly easier
>> than the latter. Similarly, all things being equal, do not distribute
>> binaries of your software - have end-users compile binaries themselves.
>>
>> Of course all things are not equal, and frequently compiled languages
>> and distributing binaries is the correct choice. If that is the case
>> deterministic build systems MUST be used when possible; if using them is
>> not possible take great care with the process by which binaries are
>> created and try to create long-term plans to move to a deterministic
>> build system in the future.
>>
>>
>> ** PGP
>>
>> Developers of wallet software MUST make use of PGP and participate in
>> the web-of-trust. Developers MUST advertise their PGP fingerprint
>> widely, for instance on personal websites, forum profiles, business
>> cards etc. simultaneously. Multiple paths by which someone can find a
>> fingerprint claimed to be of some developer make subterfuge easier to
>> detect and more costly to carry out. When possible it is highly
>> recommended to attach these advertisements to real-world, physical,
>> actions. For instance the author has included his PGP fingerprint in
>> highly public, videotaped, talks he has given at conferences. He has
>> also created a videotaped statement of his PGP key that was timestamped
>> in the Bitcoin blockchain. While it certainly is possible for such
>> artifacts to be faked, doing so convincingly is expensive, labour
>> intensive, and error prone.
>>
>> Developers SHOULD sign as much communication as practical. Sourcecode is
>> one form; your emails to development lists and between each other are
>> another. Signing both leaves a large body of widely distributed work,
>> all tied to your identity. (it's highly unfortunate that nearly all
>> publicly available mail archives do not make mail accessible to the
>> public in such a way as to allow verification of PGP signatures; often
>> even inline signatures are broken for various reasons)
>>
>>
>> *** Increasing adoption of PGP
>>
>> Keep in mind that end-users very rarely verify PGP fingerprints at all,
>> let alone correctly - the above advice with regard to PGP is currently
>> mostly useful in allowing *other developers* the tools they need to
>> verify the integrity of your code. For instance, in the event of a
>> suspected compromise consistantly signed code allows anyone competent in
>> the use of PGP to quickly evaluate the situation, and if warrented,
>> inform less sophisticated users through traditional measures such as the
>> media.
>>
>> While this is somewhat out of scope for this document the "DarkWallet
>> effort" should include work to make PGP more user-friendly and a better
>> experience. But that does *not* have to mean "making PGP easier for
>> grama", right now "making PGP easier for Joe Wallet Developer" is a
>> laudable goal. For instance understanding and using the web-of-trust
>> sucks right now. How can we make that experience better for a user who
>> understands the basics of cryptography?
>>
>>
>> ** SSL/Certificate authorties
>>
>> While certificate authorities are notoriously bad at the job they are
>> supposed to be doing the CA system is still better than nothing - use it
>> where appropriate. For instance if you have a website advertising your
>> software, use https rather than http.
>>
>>
>> ** Multi-factor spend authorization, AKA multisig wallets
>>
>> <mainly discussed at the conference in terms of multiple individuals
>> controlling funds, which is out of scope for this document>
>>
>> Assuming any individual device is uncompromised is risky; wallet
>> software SHOULD support some form of multi-factor protection of some or
>> all wallet funds. Note that this is a weak "should"; mainly we want to
>> ensure that users have options to keep large quantities of funds secure;
>> accepting higher risks for smaller quantities is an acceptable
>> trade-off.
>>
>> FIXME: go into more detail.
>>
>>
>> *** P2SH
>>
>> Wallet software MUST support paying funds to P2SH addresses.
>>
>>
>> ** Payment Integrity
>>
>> Multi-factor wallets protect your funds from being spent without your
>> knowledge, but they provide no assurance about where those funds went; a
>> Bitcoin address is not an identity. A payment protocol, such as BIP70,
>> is needed.
>>
>> Wallet software SHOULD support BIP70. Yes, there are (justified)
>> concerns about its current dependence on the certificate authority
>> system, but those concerns should be addressed by a combination of
>> fixing that system, and extending BIP70 with different and better
>> identity verification options.
>>
>> However, remember that in the absense of multi-factor wallets the "know
>> who you are paying" protections of BIP70 are actually pretty much
>> useless; malware that defeats the payment protocol locally is not much
>> different than malware that silently rewrites Bitcoin addresses. There
>> are other motivations for the BIP70 version of the payment protocol, but
>> whether or not they are actually interesting for users is an open
>> question; it was not designed by user-experience experts. Thus wallet
>> authors should consider supporting a low priority for now.
>>
>>
>> --
>> 'peter'[:-1]@petertodd.org
>> 000000000000000f9102d27cfd61ea9e8bb324593593ca3ce6ba53153ff251b3
>>
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