Also if bob has three open LN channels, if he has a receiving capacity of 1 BTC on channel A, someone trying to send coin via channel A will not necessarily know what other channels he has open, and a transaction getting declined would only reflect the balance on the channel with the smaller sending capacity. Or the computer behind one of the other channels might be down temporarily.
I was referring to something else, to ensure someone does not find out my balance within a certain channel. Guess I wrote wrong, sorry.
Let's say I open a payment channel with godaddy (first thing that came to mind)
I deposit 0.1
BTC and godaddy 0
BTC.
Now you (for example) can connect to my payment channel (they are public and also total balance is too) and you try to send godaddy bogus payment of 0.05
BTC. You get invalid hash (because you can do that when off-chain). That means I have at least 0.05
BTC. Then try 0.07-8-9... and finnaly you find out (with 99% certainty) that my balance is 0.1
BTCIt is about one's balance in each channel, true, I could have 100 open channels at a given time... but some might not appreciate that info to be that accessible
What the authors in the paper also describe is also expensive. To make 50k 'hops' in the LN network, it would cost ~$3-4 assuming 1 sat/hop, this is not much money, but in order to meaningful information, you would need to determine the balance of LN channels many times per day.
From what I understood you can also use "made-up"/bogus transaction hashes and you base the next move on the error receives (as I said above). So could also be free
Unless I am missing something, which is possible, when network utilization is low like it is now it will work. Once it gets busy it's going to be useless since if 100s or 1000s of transactions are happening per minute by the time you get the data and parse the data the data might have changed.
Now that channels can stay unused for weeks at a time it's a different story.
The idea was to identify someone`s "stake" in a channel.
Routing a payment through node A to node B in order to find out node A's balance.