--- Log opened Fri Aug 23 00:00:33 2013
00:01 < gmaxwell> petertodd: has anyone written about using 'micro'payment channels to enable interservice instant confirmation? I was arguing with phantomcircuit earlier and came up with a protocol.
00:02 < gmaxwell> E.g. say inputs.io and mtgox are mutually distrusting but would like to enable off-chain instant payments between their services. Also assume they've solve the problem of figuring out whos addresses are whos.
00:03 < gmaxwell> Each of them puts up a escrow of bitcoin. Multisigned by both of them with a precomputed nlocktimed refund transaction.
00:03 < gmaxwell> Then they do micropayment-channels against the escrowed funds as transactions happen.
00:04 < gmaxwell> when the escrow(s) are used up they just make a joint transaction resetting them to their current balance and commit it to the blockchain.
00:05 < gmaxwell> by doing this the most their risk is just that the other party vanishes and they have to wait till the timeout to get their escrow back.
00:06 < gmaxwell> it also means they need to lockup their daily transfer amount between the parties, but, meh. I imagine that the vast majority of transactions are small.. and you just don't allow large transactions that would use up to much of the escrow to be instant.
00:08 < gmaxwell> perhaps some protocol modification— like where the payments just move money from one escrow to another— could make it so the escrows had to only cover the imbalance, but I'm not sure.
01:38 < petertodd> gmaxwell: surely someone has? seems so obvious, but maybe not
01:39 < gmaxwell> thats why I'm asking here rather than just posting on it.
01:39 < gmaxwell> I'll try asking mike, I guess.
01:39 < petertodd> yeah, give it a go
07:15 < Luke-Jr> gmaxwell: I *thought* the payment protocol did that :/
--- Log closed Sat Aug 24 00:00:36 2013