Path Queries: Addressing Payment Reliability and Routing limitations

The exploration of privacy implications within the realm of information sharing, especially in the context of networking and routing, unveils several critical considerations. Privacy concerns emerge notably through the mechanisms of path_query and path_reply, each revealing sensitive information about network dynamics. A path_query exposes a downstream node or destination to a prospective routing node, allowing each node within the path to become aware of the queried destination. This process has nuanced implications for sender and receiver anonymity as well as the privacy of channel balances.

Sender anonymity is compromised to an extent due to the fact that a single query does not disclose the source of a payment to a routing node. However, the accumulation of queries a routing node receives, along with their origins, can significantly narrow down the potential anonymity set of the query origin. Senders concerned with maintaining their anonymity might therefore adopt strategies such as incorporating trampoline hops or entirely avoiding queries in their path construction process.

On the other hand, receiver anonymity is primarily at the discretion of how a payment is routed to them, albeit with the opportunity to choose the payment's entry point through blinded routes. The design of longer paths using path queries could enhance anonymity from both the sender and its associated routing nodes. Additionally, receivers have the option to utilize trampolines in constructing their sub-path, thus preventing routing nodes from discerning full paths and enhancing their privacy.

The issue of channel balance privacy is another area of concern. In source-based routing, there is a fundamental conflict between payment reliability and the privacy of channel balances. A path constructed without knowledge of channel balances leads to low probabilities of payment success, while perfect knowledge facilitates optimal routing but compromises privacy. It's noted that channel balance information is shared among channel peers, implying an existing trust relationship regarding privacy. Furthermore, while probing remains a method for nodes to obtain channel balance information, thereby posing a challenge to privacy, path queries offer a more controlled approach. Through path queries, liquidity uncertainty is minimized, distinguishing it from trial-and-error methods. Path queries allow nodes to selectively reveal liquidity information, thereby providing a mechanism to manage privacy concerning channel balances more effectively.