10 sats \ 1 reply \ @rajab 19 Dec 2023 \ parent \ on: The Lightning Network is not sufficiently decentralized lightning
The page itself states, "(Tor nodes excluded)". So that page is only displaying information about less than 30% of the total number of nodes on the network (source).
So this statement:
Is incorrect. It would actually be 30% of 30% are on 5 cloud providers, which is 9%, as far any anyone can actually prove.
I bought a used Antminer S9 from Ebay last year, and performed the mods from CryptoCloaks' guide (linked in another comment here). I also flashed BraiinsOS and detuned it to 400W so I can run it in my office while I work. It heats the room enough so that it's noticeable but not uncomfortable, but I know it'll never be profitable. It's just about the experience for me. All in I probably paid around $350 in total, including mods.
Of course consolidation is bad for privacy, since it reveals links to different histories that a receiver wouldn't have known about otherwise. When the fee environment allows for you to do so, based on your personal preference, I'd put bitcoin into Whirlpool's various pools so that when I spend from them, they have forward-facing anonymity. Meaning, their history is not linked to me spending them. Utilizing the different size pools allows you to spend from the smallest available single output so that you're not also doing a consolidation on spend.
People usually choose custodial wallets for convenience and ease-of-use. It makes onboarding a new user a very simple process to show them that all they need to do is download/install an app on their phone and hit a "Receive" button to get bitcoin. There are plenty non-technical users that if they encountered anything more than that, would simply be unable to take Bitcoin seriously.
Unfortunately users who solely rely on custodial wallets are still facing severe risk in the form of incompetence on the wallet's part by leaking their data, or voluntarily sharing data with governments, or in the form of confiscation either by those government or through hacks. Centralized entities are easy targets for both governments and hackers, so custodial wallet users are placing a high degree of trust in that wallet and the organization behind it.
I think a better way to onboard new users would be to use wallets which allow the safe use of another person's Bitcoin node, but ideally your own. Samourai Wallet is the best-in-class for on-chain transactions since it gives you privacy options when spending. New users won't understand enough to think about that right away, but it's better for them overall if they're first familiar with it as a wallet. For Lightning, Phoenix or Muun (which isn't actually Lightning) would be a "good enough" first stop for a new user without the ability to run their own node, especially since you can use Phoenix over Tor (you can use Muun over tor via Orbot, but that would be far outside the ability of any new user).
I won't get into why SegWit was originally implemented since that's been covered over and over by many different people, so I'll accept your opinion here that it was created for the purpose of scaling. I see two primary flaws in your reasoning:
The first flaw is assuming that Bitcoin is solely meant for "financial transactions" and that Ordinals are "non-financial transactions". If we can agree that Bitcoin is an economic settlement network, which I believe is an accurate description of what it ultimately is (without getting into censorship resistance, decentralization, etc.), then all activity on the network becomes "financial" since each transaction is effectively paying for settlement in the form of confirmations. Since Ordinals are paying for and receiving settlement, they are valid economic activity on the network and therefore "financial".
The second flaw is stating that Ordinals "are currently spamming layer 1 to such a degree that it's less usable for financial transactions". Since we've already described how Ordinals are valid "financial transactions" and that they are paying an acceptable fee for settlement, they can't reasonably be considered to be "spamming". Ordinal users currently have a stronger preference for confirmations (settlement) than other users. Other users, whether it be for standard P2P transactions, coinjoining, entering or leaving a second layer, etc., still have the ability to express their preference for confirmations by setting a higher fee on their own transactions. These other transactions may also be using SegWit for scaling purposes and receiving confirmations based on their fee.
Since non-Ordinal SegWit transactions have the same opportunity for settlement within Bitcoin, I believe your conclusion is invalid. Bitcoin will be used by people you don't like, for purposes you don't agree with. Its rules are in place to enforce an equal playing field for all users, regardless of their intentions, so long as they follow the rules. Ordinal transactions are following the rules of the network, otherwise their transactions wouldn't be propagated across the network to be included in blocks in the first place, nor would blocks that did include them be accepted by the network.
That makes sense, and in that case, my regret would be paying for any hardware wallet without spending the time to learn about DIY-ing one myself, like with SeedSigner.
Don't regret spending BTC to buy something. If you didn't spend-and-replace, that's on you. It's not the fault of the item/service that you bought or the merchant you bought it from, which you should be excited if they even accept BTC in the first place.
Spending BTC is using the network. The best way to learn about Bitcoin is to use it.
No one can "modify" a transaction except for the holder of the private key that signed it. They could only (attempt to) censor in the way stated in my reply above.
There's only like 2 things they'd be able to do with a majority hashrate, and even then their success is unlikely. They could censor transactions, which would still get through eventually, as those transactions are mined by other pools. This would be publicly visible activity on sites like miningpool.observer and would be called out. Then they could also do a 51% attack, which would also be publicly visible. I think the risk with the 51% attack is the scenario where they rewrite the chain any time an honest miner includes a censored transaction.
The problem with this is that as soon as such malicious activity is reported publicly, we can safely assume that both of these mining pools will lose a significant amount of hashrate. Meaning they practically only have one shot to censor some transactions until hashrate is pointed elsewhere. Then what? They'd lose all (or at least a majority of) future mining profits, and no one would realistically use them again.
Bitcoin would benefit because it would demonstrate how meaningless this type of attack truly is and it would likely accelerate R&D in mining pool tech. It might also show how shit KYC and get more people on-board with avoiding all forms of KYC when it comes to using Bitcoin. So yeah, IMO, this is just an old argument that's been "hashed out" over and over, and is a total nothingburger.
And don’t overestimate the capabilities of chain analysis firms. They know less than you think.
This is fairly dangerous advice, IMO. Even if you believe CA is incapable today, doesn't mean you should downplay the importance of on-chain privacy. Since the transactions are recorded forever, and we can very safely assume that CA's capabilities will increase in the future, the best time to begin taking on-chain privacy seriously is now.
GENESIS