The Ark case for CTV

The Arkoor model presents a nuanced approach to managing the liquidity cost associated with refreshing VTXOs (Unspent Transaction Outputs), which is directly proportional to the time remaining until their expiration. This model offers users a trade-off: opting for full trustless ownership of the VTXO by refreshing it, which incurs a higher liquidity fee, or accepting the Arkoor trust assumption for an additional 15-30 days, thereby saving on fees. It's anticipated that users holding significant amounts in their VTXOs and receiving them from unknown third parties will likely opt to refresh their VTXOs early to avoid risks, whereas individuals engaged in smaller, everyday transactions may prefer to save on fees by delaying the refresh process.

However, the system faces challenges, particularly regarding the interactivity requirement of the round, which is crucial for its operation but also makes it vulnerable to denial-of-service (DoS) attacks. The round requires active participation from all users to successfully complete, and an attacker can disrupt this process by entering the round with multiple identities and intentionally failing to cooperate, forcing the round to restart. To combat these vulnerabilities, the model implements two key strategies: banning non-cooperative users from subsequent attempts and penalizing the VTXOs of participants who abandon the round. While senders, who submit a VTXO as input, can be directly penalized by reducing the value of their submitted VTXO, receivers present a challenge as they do not have an existing VTXO to penalize, making them immune to direct penalties and thus potential vectors for DoS attacks. This limitation highlights the inherent difficulties in enabling receivers to participate in rounds without some form of penalty mechanism in place, illustrating broader challenges within systems requiring high degrees of interactivity and cooperation among participants.