Critical problems with Trestor - Read before use

[btcsnatcher]

Sorry, I got you wrong then. I thought you doubted there. We are on the same page here.

I was excited to see a crypto company coming up in India at first, but kinda went sour as I saw their marketing/ product.
It does bug me when I can see that another crypto-scam-news is around the corner from India.

If you have any suggestions on how, as a community, we can address this, I'll be glad to chip in.

It' sad to see that people try this hard to make their scams and ponzi schemes look realistic enough so that people may become their victim instead of just putting an equal effort into creating something that might actually be beneficial for the bitcoin community and play a vital role in developing and enriching the cryptocurrency world through their efforts...

[trestorfoundation]

https://bitcointalk.org/index.php?topic=1057794.0

Kunal,

Either you guys are marketing your product in a very wrong way, without getting consensus of the people who understand this technology, or you are running a scam.

Do clarify on the Thread.

Best wishes,
Benson

Kunal Dixit <kunal@trestor.org>
4:46 PM (21 hours ago)


Hi Benson,

Thank you for bringing this to my notice. We are obviously not a scam because to be called a valid scam you need at-least one victim who got scammed by the potential scammer.

I encourage Indian bitcoin community to call our Retail Partners, this would help Trestor because this community driven quality assurance would help us identify Retail Partner who lack appropriate knowledge to answer a Trestor related query then maybe we need to drop their name from our website. 

As a confidence building measure, I will share our non-public 'Tech-Draft' along with other critical research content with you in a separate mail.

Trestor is proudly Indian, I assure you that Trestor team is fully committed to financial inclusion and decentralization.


Kunal Dixit
Founder
Trestor Foundation
www.trestor.org

[Benson Samuel]

https://bitcointalk.org/index.php?topic=1057794.0

Kunal,

Either you guys are marketing your product in a very wrong way, without getting consensus of the people who understand this technology, or you are running a scam.

Do clarify on the Thread.

Best wishes,
Benson

Kunal Dixit <kunal@trestor.org>
4:46 PM (21 hours ago)


Hi Benson,

Thank you for bringing this to my notice. We are obviously not a scam because to be called a valid scam you need at-least one victim who got scammed by the potential scammer.

I encourage Indian bitcoin community to call our Retail Partners, this would help Trestor because this community driven quality assurance would help us identify Retail Partner who lack appropriate knowledge to answer a Trestor related query then maybe we need to drop their name from our website. 

As a confidence building measure, I will share our non-public 'Tech-Draft' along with other critical research content with you in a separate mail.

Trestor is proudly Indian, I assure you that Trestor team is fully committed to financial inclusion and decentralization.


Kunal Dixit
Founder
Trestor Foundation
www.trestor.org

You should post the rest of that mail trail as well..

[trestorfoundation]

Benson Samuel
5:45 PM (20 hours ago)

to me
Telling me this is not going to help.
You need to address the forums and explain why we are incorrect.


Kunal Dixit <kunal@trestor.org>
5:56 PM (20 hours ago)

to Benson
Yes. You are right. Will do that over the weekend. I really appreciate your effort in shaping and leading a healthy cryptocurrency community in India.

[skang]

Thanks a lot Benson!

Kunal,
1. Please share the 'tech-draft' for a review, I'll sign an NDA if you need, although it violates one of your '4 principles'.
2. Please share your Indian registrations.

Kunal's intro on the Trestor website:
"Kunal is an astute student of money and human cognitive biases, he builds his models by leveraging the fact that human beings are visibly irrational, especially in a group/tribe format."

From the FAQ on the site :

8.How do I know that my donation will reach the right place and help the right people?

Ans: Trestor has created “4 Principles” which would help us make every dollar of donation count and thereby invigorate donor confidence:

Transparency - making information available and accessible to public for scrutiny

Answerability - providing clear reasoning for actions and decisions

Compliance - monitoring and evaluation of procedures and outcomes

Enforcement - Sanctions for shortfalls in compliance, answerability, or transparency

[trestorfoundation]

Hello Skang and other India community members,

NDA would not be required, here's a link to our Technical Draft.

https://docs.google.com/document/d/182td7t8jMVKEr3K6yVwXvmeZjuC2o0vlaQ91iz0jJIA/edit?usp=sharing

Apologies for not keeping in touch, we would greatly appreciate any feedback/suggestions, feel free to comment in as your read.  

Details of our Physical offices:

Toronto, Canada:   Suite 608, 120 Eglinton Avenue East, Toronto, M4P1E2. Phone: +1-416-605-1295

Chandigarh, India:  Plot # J-7, Rajiv Gandhi IT Park, Chandigarh, India Phone: +91-0172-6579292, +91-76965-71000

Seoul, Korea: 197-33, Guro 3-Dong, Guro-Gu, Seoul Phone: +82-10-9910-2173


Regards,

Trestor Team
www.trestor.org
@trestorconnect
www.facebook.com/trestor.org

[skang]

SCAM CONFIRMED (or stupidity maybe? But since they took people's money I'll call it scam.)

Please read their algorithm for yourself : http://pastebin.com/bCs37CLb

[skang]

Since this thread was marked unresolved, let us try and resolve it.

Before I point out flaws in the algorithm and why the implementation is scammy, I request you to answer the following 2 questions:
1. What gives bitcoin value? How is the price of 1 bitcoin determined? Why?
2. Since we already have consensus in the form of blockchain, what is the use of "proof-of-work" in bitcoin?

[trestorfoundation]

Dear Skang,

We assume you are asking these question from Trestor. We will try our level best to reply.

What gives bitcoin value? How is the price of 1 bitcoin determined? Why?

Bitcoin is an intentionally designed,  decentralized, peer to peer virtual currency. For the first time in human history, we have created a global currency which is neither backed by the market (commodity money) or the state (fiat money).

Bitcoin has properties resulting from the system's design that allows them to be subjectively valued by individuals. This valuation is demonstrated when individuals freely exchange Bitcoins over various global exchanges. This voluntary exchange between buyers and sellers determines the real time value of Bitcoin at that particular instant.

2. Since we already have consensus in the form of blockchain, what is the use of "proof-of-work" in bitcoin?

Not sure if we understand the above question, could you please elaborate?

Trestor Team
www.trestor.org
@trestorconnect

[skang]

We assume you are asking these question from Trestor. We will try our level best to reply.

Yes sir, and you did not need to assume since you are the previous poster in this thread above.

What gives bitcoin value? How is the price of 1 bitcoin determined? Why?

This valuation is demonstrated when individuals freely exchange Bitcoins over various global exchanges.

Cool that you recognize that the value of bitcoin is what individuals wish to trade it for.

2. Since we already have consensus in the form of blockchain, what is the use of "proof-of-work" in bitcoin?

Not sure if we understand the above question, could you please elaborate?

Let's say few of us friends decide to create a playmoney system, where everyone gets equal amount of some starting money to pay others with. Whenever someone owes someone else money, they simply mail this information to everyone, saying that "I pay so&so this much money". This mail-chain is a ledger, that everyone of our friends have and thus everyone knows who paid whom what; basically a consensus. Transactions declared that conflict with previous transactions are not accepted. No one can double spend etc because there is a consensus reached by mail-chain.

This is system is the first part of bitcoin system, like the hashcash system that existed before bitcoin. A simplified version of this system is very commonly used in daily life among friends living together in hostels, where they don't actually pay money but just keep an oral record of who owes whom what and then pay up when money arrives.

But there are some problems in this system, because it won't work for large groups even if everyone has good memory(lets say they write it down in their diaries), and also other issues because of which hashcash like systems don't work.

Thus a consensus is not enough; proof-of-work is also required. Why? What are these issues? And how does proof-of-work solve these issues?

***

The reason why I asked these two questions is that I just wanted you to understand with respect to trests is that :
- Value of a trest is not decided by trading individuals
- T-net eliminates proof-of-work mining by a consensus system of validators. But simply a consensus is not enough, your understanding of which would be demonstrated by your answer to the above.

[trestorfoundation]

Dear Skang,

Thank you for elaborating on the question, it is much more clear now.

Thus a consensus is not enough; proof-of-work is also required. Why? What are these issues? And how does proof-of-work solve these issues?

Your principal argument is deeply flawed, consensus is enough, that is all one needs, consensus is the end goal and proof-of-work is the tool used by bitcoin protocol to make its network come to a consensus.

There are over 300 altcoins with many variations, there is only one thing common, in fact central to every coin without exception and that is 'Consensus'.

Proof-of-work, proof-of-stake, proof-of-<whatever> are tools utilized to help the network come to a consensus.

The most fundamental difference between Trestor network (T-Net) and bitcoin/alts is that we have Insulated the 'current state of the network' from 'history of the network'

Therefore T-Net transactions are always 100% confirmed whereas in bitcoin no transaction ever gets completely confirmed, every transaction is theoretically open to an overwrite. This does not in any way mean that bitcoin is unsafe, it just means that bitcoin network cannot guarantee probabilistic certainty.

Trestor Team
www.trestor.org
@trestorconnect

[trestorfoundation]

We will be happy to answer any other questions.

Thanks guys,

Trestor Team
www.trestor.org
@trestorconnect

[skang]

So to summarize people, Trestor has admitted to two things:
1. Proof-of-work is not required, a consensus is enough. (Comfortably ignoring the failure of consensus based systems like hashcash that existed much before bitcoin. Also, Trestor has no proof-of-whatever in their system, so there)
2. Value of a cryptocurrency is whatever people exchange it for. Treats however have fixed rate (, determined out of thin air.)

Let's move further.

Dear Trestor,
1. What is your justification of a 100% premined currency?
2. The only way to obtain trests is to buy them from the Trestor foundation. Why does the foundation lists every sale as a donation?

After this, we shall dig further the flaws in the algorithm..

(Since I am trekking won't have good internet for next 3 days, so might reply after that)

[trestorfoundation]

So to summarize people, Trestor has admitted to two things:
1. Proof-of-work is not required, a consensus is enough. (Comfortably ignoring the failure of consensus based systems like hashcash that existed much before bitcoin. Also, Trestor has no proof-of-whatever in their system, so there)
2. Value of a cryptocurrency is whatever people exchange it for. Treats however have fixed rate (, determined out of thin air.)


Yes, we admit it. Network consensus is enough.

As more and more Trests come out in the open market, exchange value of each Trest would begin to be subjectively determined by market participants.

Dear Trestor,
1. What is your justification of a 100% premined currency?
2. The only way to obtain trests is to buy them from the Trestor foundation. Why does the foundation lists every sale as a donation?

Strictly speaking, Trests are Pre-Assigned not pre-mined, because pre-mined is used where the creators of a protocol, mine some coins before opening their network to other mining participants. As, there is no mining in Trestor Network, Pre-Assigning is a more appropriate term. Justification for Pre-Assigning is strong but complex, therefore it will be detailed in our whitepaper. 

"Trest" is short for Trestor Donation Receipt (TDR). 

We look forward to understanding the flaws that you discovered. Enjoy the trek.

Trestor Team
www.trestor.org
@trestorconnect

[skang]

Trestor further admits:
3. Trests are 100% pre-mined (but since 100%mined means no mining they call it 'pre-assigned' & explanation is too complex so they will release separate document on it)
4. When you buy trests, its not a purchase but a donation, so there is no legal protection for you (because "Trest" is short for Trestor Donation Receipt & it could not have been Trestor Sale Receipt)

Here are the problems in the algorithm:
1. Account not UTXOs. In Trestor Network, ‘the state’ stores a list of accounts where each account has a balance, and a transaction is valid if the sending account has enough balance to pay for it.
- The definition of a coin as per Satoshi's paper is "electronic coin as a chain of digital signatures." In bitcoin, we could only store the addresses with their latest balance; why the hell do we need to store all the past transactions? Blockchain's space requirement problem solved isn't it? Brilliant? Absolutely not. Maintaining a chain of transactions is required to maintain the consensus of validated blocks. It means that even if a block is disputed, you could trace its origin right back to the coinbase.
Since Trestor is 100% premined, they are the ones issuing accounts and 'the state' maintains account balance, just like a bank.
If there is a dispute, there is no history and resolving it is purely a matter of Trestor's discretion.
Worst still, if a majority decides that a transaction is valid, that transaction is validated, irrespective of any algorithm preventing trests to be created out of thin air; not even Trestor!

2. Since there is no mining to validate transactions, the way to validate is, you pay (or rather donate?) Trestor to award you the designation of a 'Validator'.
Now when a transaction comes through, the validator can at best check if the sender's account has balance of trests. If so & if that validator has not approved a contradicting transaction before, they validate it.
Since the validators have no economic incentive to validate trests, why would they do so? To earn from fees or to earn by selling trests.
Both ways it is a two-level pyramid scheme where investors who will continue to recruit other investors for an incentive that is presented as an investment opportunity - the right to sell a particular product or to earn fees from them.

Even if all of the above was legal on some planet or that I am totally crazy to miss out on something, the algorithm is still flawed:
- In case of a double spend the transaction gets stuck, since validators can't vote against themselves. To resolve this they have implemented time-bound validity of nodes. This doesn't solve it. Consider a scenario where first 50% validated A->B and second half validated A->C at the same time. The transaction gets stuck. Votes expire after time t and now the first half votes for A->C & the transaction gets stuck again & so on..
- The value of t is not based on anything but pulled out of air.
- If more than 80 percent of a node’s peers have voted for a set of transactions, it goes through. The value 80% and node's peers (100) is based on nothing but pulled out of air.
- To make T-net scalable, a validator doesn't needs votes from 80% of the network but from random 100 validators. This randomization implementation would be out when Trestor open sources it's code on 1st July, but unless it is based on a physical system, it would most likely be predictable. Even if not, this list is stored by Trestor so is prone to corruption.
- When a new validator node gets set up, it will select a fixed number of peers (e.g. 100) from the known set and use their votes as a basis. At the same time, there will be about 100 nodes selecting this new validator as their basis. Graphs don't work that way. Suppose 4 kids are standing in a circle holding hands, as an example of 4 validators with 2 peers. When a fifth child comes and offers its two hands to be held by 2 random kids, the kids already in the network need to produce a third hand! Thus the number of edges in the graph changes unless the graph reorganizes itself for every newcomer which is a separate problem.
 

A funny thing is, all of the above would be legal and ok (though hackable) if you register as a pre-paid instrument like PAYTM or Paypal or a bank.

[trestorfoundation]

Dear Skang,

Welcome back. Hope you had a fun trekking trip.

Trestor protocol makes no assumptions about the rational behavior of attacker. Compared to generic proof of-work/proof-of-stake schemes, our protocol has minimal computing requirements. UTXOs is not the only solution for distributed security. Prof David Mazieres, Head of Stanford's secure computing group has written extensively on this topic. http://www.scs.stanford.edu/~dm/home/papers/

Do you really mean the following statements: 

1.  A consensus is not enough; proof-of-work is also required.

2.  Worst still, if a majority decides that a transaction is valid, that transaction is validated, irrespective of any algorithm preventing trests to be created out of thin air; not even Trestor!


Also, we didn't quite understand the legal protection and two-level pyramid scheme accusation.

Trestor Team
www.trestor.org
@trestorconnect

[Benson Samuel]

I have few questions as well. Just waiting for skang to finish.

[skang]

I am done saying what I had to.
'It is difficult to get a man to understand something, when his salary depends on his not understanding it' but I hope people read everything and decide for themselves.

Trestor is now citing David's paper about Stellar protocol (SCP), which already forked due to faults. There is a reason why Stellar is now centralised and working with Ripple.
Anyways, Trestor doesn't use SCP or even byzantine consensus.

[trestorfoundation]

Skang,

We are confident that you have genuine intentions and your motivation is to save the community from yet another altcoin fraud.

Trestor team is not a scam, just a bunch of Individuals who have come together to create something truly new and innovative. All of us are financially well placed, money is our secondary motivation, primary is to 'create something awesome which not only us, but our parents and our country can be proud of '
   
We will be happy to answer any more questions here.


Trestor Team
www.trestor.org
@trestorconnect

[trestorfoundation]

Dear Skang,

David's paper about Stellar protocol (SCP), which already forked due to faults. There is a reason why Stellar is now centralised and working with Ripple.


We are citing David's work in general, his SCP research was commissioned because of the fork, paper was released much later. 

Do you still think Trestor project deserves such a thread title?

Trestor - A confirmed cryptocurrency scam !


Trestor Team
www.trestor.org
@trestorconnect