Are these just signs of a very bad month for BTC scaling solutions?

[alani123]

The most major proposals for scaling bitcoin transactions were met with major hurdles this week. Including vulnerabilities in their system, design flaws as well as overlooked weaknesses in their system.
To be specific:

Replace-By-Fee implementation caused several wallets to have a double spend vulnerability.:
https://twitter.com/zecWhaleClub/status/1278702297149853696

The lightning network was faced with a so called "Flood & Loot" attack:
https://medium.com/@jonahar/flood-loot-a-systemic-attack-on-the-lightning-network-5c3dac7bba24

And finally, it was revealed that in the way Liquid's operates, "2-of-3 operators can steal 870 Bitcoin".
https://twitter.com/_prestwich/status/1276300994989572096

Is this indicative of failure? Many critics and naysayers would like to believe such now that so many failures happened so close to one other. But what's the whole story?
Is there hope? Will those mishaps be able to be addressed effectively or is it indicative of a trend between solutions seeking to address scaling?

[Carlton Banks]

1. Double spends aren't possible, with Replace-by-fee or without it. And it doesn't have much to do with scaling really. If you are the receiver of any BTC transaction (RBF or not), wait for it to be confirmed in a block before you consider the money to be safely yours.

2. Mitigations and solutions are/will be available for Flood & Loot, really all the major Lightning node implementations already had mitigations in place, as the basis of this attack was discovered around 1 year ago by Lightning developer Rene Pickhardt (the authors of the Flood & Loot paper describe a variant of the attack that Rene discovered)


Don't know anything about the Liquid vuln, but it's slightly irrelevant in the long term if exchanges simply use Lightning channels instead (Liquid was available before Lightning, and is designed to provide BTC liquidity to cryptocurrency exchanges by allowing them to exchange BTC faster than the on-chain Bitcoin network can)

It's not really much of a bad sign IMO:

• dev finds vulnerabilty
• discloses responsibly to other devs
• mitigations written and implemented
• 1 year later, someone else figures it out and publishes details

[maenauaras]

RBF is part of Bitcoin protocol, and it is not a double spending because the transaction was not confirmed within the block.
The lightning network is second layer and finding a loophole in it does not mean the end of the network, even if the lightning network ends, it will not affect Bitcoin prices.
Technical problems will not change prices unless there is a breakthrough for platforms or other things.

[BrewMaster]

RBF is part of Bitcoin protocol,

no it is not part of the "protocol". RBF is more like standard rules that a node can apply or choose not to. or they could even apply a very different design for what they think RBF transactions should be like.

and it is not a double spending because the transaction was not confirmed within the block.

when you spend the same transaction output in two different transactions it is a double spend. that makes every RBF transaction a double spend by definition and it has nothing to do with being confirmed or not.

[hatshepsut93]

No one writes a complex software without bugs, and this is the reason why Lightning Network is still considered to be in beta, even if it's used on mainnet. The more bugs found now, the less bugs will be found when it will get officially released. It's really sad  if people lose their money due to them, but as long as the damage is not too big and the fixes are quickly released, it all can be considered under control.

BTC is still miles ahead of alts, which are even more prone to bugs, and have inherently unsecure deisgns.

[bitbunnny]

No one writes a complex software without bugs, and this is the reason why Lightning Network is still considered to be in beta, even if it's used on mainnet. The more bugs found now, the less bugs will be found when it will get officially released. It's really sad  if people lose their money due to them, but as long as the damage is not too big and the fixes are quickly released, it all can be considered under control.

BTC is still miles ahead of alts, which are even more prone to bugs, and have inherently unsecure deisgns.

Unfortunately bugs are normal part of every developing process and although they can be harmful, simply can't be avoided. But although some users lose money in the Lightning network these are not so significant issues and I'm sure it will be corrected in near future. But some users don't understand that this is the phase we need to go through, so sometimes more education and information is needed.

[figmentofmyass]

Replace-By-Fee implementation caused several wallets to have a double spend vulnerability.:
https://twitter.com/zecWhaleClub/status/1278702297149853696

a few specific wallets have questionable UI that makes unconfirmed low fee transactions (including RBF) appear to have been "received". that's all. the "vulnerability" is purely a wallet UI issue, and it actually pertains to all unconfirmed transactions.

it's rather dubious that the researchers are framing this as if RBF is the issue at all.

[kryptqnick]

The most major proposals for scaling bitcoin transactions were met with major hurdles this week. Including vulnerabilities in their system, design flaws as well as overlooked weaknesses in their system.
To be specific:

Replace-By-Fee implementation caused several wallets to have a double spend vulnerability.:
https://twitter.com/zecWhaleClub/status/1278702297149853696

The lightning network was faced with a so called "Flood & Loot" attack:
https://medium.com/@jonahar/flood-loot-a-systemic-attack-on-the-lightning-network-5c3dac7bba24

And finally, it was revealed that in the way Liquid's operates, "2-of-3 operators can steal 870 Bitcoin".
https://twitter.com/_prestwich/status/1276300994989572096

Is this indicative of failure? Many critics and naysayers would like to believe such now that so many failures happened so close to one other. But what's the whole story?
Is there hope? Will those mishaps be able to be addressed effectively or is it indicative of a trend between solutions seeking to address scaling?

Thanks for putting it all in one place! It looks like these are all serious problems, and this is bad news. IMO scaling it the biggest problem of Bitcoin, and the one that must be solved or widespread adoption would be impossible. The Lightning Network still seems like the best solution out there, but I hope someone will come up with something better (safer, less centralized, more user-friendly, more effective). I don't think the LN has the potential to go mainstream at this point... It's good that Bitcoin transactions have been cheap and fast lately, but this is just a temporary thing until a price changes significantly again and people become more active.

[alani123]

[snip]

• dev finds vulnerabilty
• discloses responsibly to other devs
• mitigations written and implemented
• 1 year later, someone else figures it out and publishes details

Thank you for the thorough comment addressing every part of my post.

I'm hopeful that criticism to bitcoin solutions could receive more discussion here without cynicism.
I'm sure there's a lot of insight this forum's users could share. But sadly this potential is lost because discussion of potential flaws seem to mostly catch the attention of trolls at first.
I for one hope I'm not taken as I troll myself for posting this.

Progress and improvement is a good thing of course. Especially given that bugs need to be discovered and solutions need to be tested. All so solutions like the lightning network can be robust before large-scale deployment so. But all these shortcomings made me consider that progress on scaling solutions might be slower than some bitcoin supporters would like to promote that it is.

[Tipstar]

It's better that these vulnerabilities are being found before these projects going onto full action and the effect they may have is negligible to none. It's the right thing to do to develop alternative solutions and give them time to let us learn which would fit the best with bitcoin and it's essence. Scalability is a problem in bitcoin that needs fixing and everyone seems to have accepted it now.