[BROKEN] Multi-Party Eltoo with bounded settlement

Jan 6 - Jan 6, 2025

  • The discussed scheme significantly minimizes the potential for malicious parties to hinder the fair settlement of the channel by allowing parties only a single opportunity to update the channel state on-chain.

This approach is considered a compromise in scenarios where trustless watchtowers cannot be incorporated into the signing quorum directly. The optimal setup would involve having N counterparties, who form the consensus quorum for state updates, with an additional M > N slots allocated for state submission. However, it's acknowledged that each increment in N incurs additional costs in terms of vbytes and necessitates longer relative delay periods, highlighting the absence of a universally ideal solution. This balance between security and efficiency underscores the complex trade-offs involved in designing such systems.

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