BLISK: Boolean circuit Logic Integrated into the Single Key

In exploring the potential for a k-of-n Lightning Network (LN) node configuration, it's imperative to understand the intricacies and challenges that come with channel creation and state management within such a framework. The fundamental concept involves the ability of channel parties, either singularly or in combination, to operate under a k-of-n policy. This policy can be expressed in Disjunctive Normal Form (DNF), exemplified by a 2-of-4 scenario involving parties A, B, C, and D. The expression for this configuration would encapsulate all possible two-party combinations in a logical OR sequence. This DNF representation, crucially, can be transformed into its Conjunctive Normal Form (CNF) counterpart. Such transformations allow any nested AND-OR expression to be flattened into an AND-of-OR structure which then can be efficiently processed using Blisk.

However, this approach introduces significant operational challenges. Firstly, generating a new channel state is contingent upon acquiring a partial signature from the counterparty without creating a full signature on one's side. The generation of a full signature, necessary for unilateral closure, poses security risks if conducted prematurely since access to such signatures could enable unauthorized posting of old channel states. It's posited that within the CNF, there might exist terms exclusively controlled by one party's signatories, thereby dictating the conditions under which unilateral closure—and consequently, full signature creation—should occur.

Another hurdle pertains to the invalidation of previous channel states. Traditional LN protocols rely on the shachain mechanism as stipulated by BOLT for this purpose. However, adhering to a CNF-based approach necessitates abandoning the shachain requirement due to compatibility issues. Instead, the public key for the revocation key can be generated through the CNF and Blisk process, with the private key for revocation being calculated at the time of actual revocation. This method circumvents the limitations imposed by shachain while ensuring secure state management.

An alternative solution to both challenges is offered by the Decker-Wattenhofer approach. Unlike other methods that require consensus changes, Decker-Wattenhofer facilitates the simultaneous creation of new states and invalidation of old ones through a single atomic step, thus eliminating the need for storing potentially unsafe full signatures. This technique not only addresses the security concerns associated with CNF and Blisk but also simplifies the operational complexity inherent in managing k-of-n LN nodes. Moreover, the concept of flattening to CNF followed by Blisk application presents a generalized version of the technique discussed in detail at Delving into Bitcoin, further highlighting the versatility and potential applicability of this approach in optimizing LN node configurations for enhanced security and efficiency.