100 sats \ 1 reply \ @justin_shocknet OP 25 Apr \ parent \ on: "Federated" is nomenclature used by scammers to mislead the non-technical bitcoin
By their own documentation, the security model is bank runs... It's not even multisig (I'm aware they are pursuing FROST but that begs other questions about the coordination)
A client that verifys signatures can eliminate some of the communication layer risk, but it still comes down to single point of control transactionally, including ingest of the destination specified by the client.
Important to remember that at a high level these are perpetual motion machines, if they worked as users are lead to believe, Bitcoin wouldn't be needed because we could forego PoW consensus and call it good with quorum.
As for scamming the regulators, the holy grail is breaking up custodianship into countless pieces. Federations are re-centralization tech, and therefore and an attack on that vision.
If its not multisig, then that defeats the whole purpose of a federation.
The client can broadcast their transactions to multiple guardians to mitigate transaction censorship from malicious guardian.
Federations are just another way to run custodial bitcoin. They have a different trust model than the traditional single custodian controls everything. They still require total trust that a group of the guardians won't go malicious.
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