Why doesn't bitcoin have a "freeze" function?

[larry_vw_1955]

I was trying to make a payment using my credit card last night and it was being declined and I was like what the heck. So I thought maybe they close my account since it been over  a year since I used it. Instead of calling, I logged into my account online to see if maybe it would be of any help in seeing if my account is having a problem, well it looked fine like it is still open. Hmm. Now I'm thinking I need to call them because I don't know what the heck is going on why it is being declined. But then I see a button at the top of the screen that says "Your account is frozen, you can unfeeze it by clicking this button." Then I remembered I had frozen the account by clicking the freeze button a year or so ago so that no one can do any activity on my account not even me! Well I guess it worked fine!

But now I needed to unfreeze my account so I can do a transaction I need so I click on unfreeze and bada bing bada boom, I tried doing the transaction again and it worked. If I wanted to I could click the freeze button again and put my card back into a deep freeze so that no one can use it even if they know the credit card #, expiration date and special number on the back of the card (call it a private key if you like). That's pretty amazing tech, don't you guys think?

I forgot to re-freeze my card so hopefully no one has used it in the last 24 hours or so that I don't know about!

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[ranochigo]

You can freeze your outputs with specific time parameters, so that the outputs in that specific address can't be spent until the time has elapsed.

If your idea is to freeze your Bitcoins as and when you like as a security measure, that doesn't really improve your privacy significantly. Your security should be guaranteed by how you handle your keys and your security habits.

[nc50lc]

-snip-

Electrum has that function; but it's more of a "coin-control" feature than safety.
Because it's possible client side - freeze an address or UTXO from being spent (though that client) but it wont stop anyone who already got your private keys from spending your coins.

I don't think it's possible to freeze coins in the blockchain unless those are locked using a script that can be frozen/unfrozen any time which I don't think we have (please inform me if there's one).

[garlonicon]

You can always lock your funds using 2-of-2 multisig, where the first key is your real public key and the second key controls your freeze/unfreeze options. Then you need both to spend any funds.

[PrimeNumber7]

You can freeze your outputs with specific time parameters, so that the outputs in that specific address can't be spent until the time has elapsed.

I don't think a nTimeLock parameter would help the OP, at least not alone. From what I can tell, the OP wants the ability to "freeze" his coin as a security measure. If the OP's private keys are stolen, the attacker could simply wait for the time lock to expire. Also, the OP would be unable to spend his coin at an arbitrary time.

Your security should be guaranteed by how you handle your keys and your security habits.

This is an important point. Bitcoin (and altcoins) is much less forgiving than the traditional banking system. With the banking system, if someone obtains your credit card information, you will typically not be on the hook for unauthorized transactions. The "freeze" feature as described by the OP is really more of a loss prevention measure for the bank as the bank is the one who will be on the hook if there is an unauthorized transaction.

I don't think this solves the OP's problem.

You can always lock your funds using 2-of-2 multisig, where the first key is your real public key and the second key controls your freeze/unfreeze options. Then you need both to spend any funds.

This is probably the closest thing to a solution for the OP. Although an alternative would be to just have one key and keep that key secure.

[pooya87]

You can always lock your funds using 2-of-2 multisig, where the first key is your real public key and the second key controls your freeze/unfreeze options. Then you need both to spend any funds.

A 2 of 2 multisig doesn't "freeze" anything, you will need both keys at all times to be able to spend coins from the created address. Additionally "freezing" usually requires a time component where user locks up their coins for a certain period of time which is not possible with multisig.

[valentine wheeler]

The wallet of a centralized exchange can be frozen, so the bitcoins in the wallet will also be frozen.

However, because of the anonymity of the blockchain and the characteristics of distributed accounting, the Bitcoin of the cold wallet cannot be frozen unless someone else uses illegal means to force you to surrender your private key.

Why is there a Bitcoin slogan: Your money is your money. Bitcoin makes us truly masters and free.

[nc50lc]

I don't think this solves the OP's problem.

Yes, that's what the first part of my reply is all about: there's a client with freeze feature but it doesn't fit OP's use-case.

[vjudeu]

A 2 of 2 multisig doesn't "freeze" anything, you will need both keys at all times to be able to spend coins from the created address.

You can have signed transaction that will allow for example to send coins only to selected address. You can make some such transactions upfront, sign it with your "freeze key" and then pick one of them, sign it with your "real key" and broadcast. Also, multisig can be combined with locktime if needed.

Additionally "freezing" usually requires a time component

There is some weird and inefficient way to "freeze" coins without any timelock, for example someone can start with some public key, add some nonce, and increment it until hitting some target. Then, it is possible for example to store that key in some safe place, but store only the starting point in the wallet. In this way, it is possible to unlock the key after redoing all computations, which takes time, so it is guaranteed that for example you need 2^48 operations to recover your key.

If all computations are linearly dependent, so you have to calculate step N to make it possible to calculate step N+1, then you have to do all computations upfront. But if opcodes like OP_CAT or OP_SUBSTR could be used, then it is possible to do that kind of timelock without setting any time.

That kind of "pseudo-locktime" better fits locktime encrypted files (so that they can be decrypted only after doing some computations), but you can use the same technique for locking coins, signed transactions or any other blockchain-related data you want. More about that: https://www.gwern.net/Self-decrypting-files

[larry_vw_1955]

-snip-

Electrum has that function; but it's more of a "coin-control" feature than safety.
Because it's possible client side - freeze an address or UTXO from being spent (though that client) but it wont stop anyone who already got your private keys from spending your coins.

It won't? That's terrible! Well that's not going to work!

I don't think it's possible to freeze coins in the blockchain unless those are locked using a script that can be frozen/unfrozen any time which I don't think we have (please inform me if there's one).

Will do!

You can freeze your outputs with specific time parameters, so that the outputs in that specific address can't be spent until the time has elapsed.

I know but the problem is, when I need to use my money I need to use it. I can't really afford to always wait for days or weeks for something to get unlocked. I might be able to wait for hours or a couple days at most but then once I use what I need, I need to be able to freeze my address again until the next time comes around. The truth is though sometimes I might even need to use my money on the spur of the moment without any waiting at all!

I don't think a nTimeLock parameter would help the OP, at least not alone. From what I can tell, the OP wants the ability to "freeze" his coin as a security measure. If the OP's private keys are stolen, the attacker could simply wait for the time lock to expire. Also, the OP would be unable to spend his coin at an arbitrary time.

On point. The part about spending my money at an "arbitrary time" thanks for bringing that up too.

The "freeze" feature as described by the OP is really more of a loss prevention measure for the bank as the bank is the one who will be on the hook if there is an unauthorized transaction.

Well I don't know about that but what I do know is it give me an incredible peace of mind knowing that because I clicked the freeze button, there is no transactions being done with my card. But the moment I need to, I can just click on unfreeze and do my business and then freeze it again, making it impervious to the outside world even if they know my card number and such. that's security, I tell you!

Now there is that matter of what would happen if I lost my credit card and someone else found it and I didn't even know about it. Well, I'll be happy to explain what would happen in that case too. You see, they wouldn't be able to use it even though they had it in their physical possession. Even with the 4 digit code number on the back of the card it would do them no good. Because when they tried to go to an atm machine or buy something, it would get declined period the end. And when I got around to noticing that someone had stolen my card, I could just call the bank and get a new one sent out, credit line transfers over to the new card. You can't beat that! I'm sure bitcoin will get to that level at some point. which will be cool. maybe that's part of taproot, not sure! there's alot of taproot experts out there, and i wouldn't put it past them to understand how that could work with this.

A 2 of 2 multisig doesn't "freeze" anything, you will need both keys at all times to be able to spend coins from the created address. Additionally "freezing" usually requires a time component where user locks up their coins for a certain period of time which is not possible with multisig.

You see I was thinking of making my friend an authorized cardholder but I told them you can't just spend money without my approval. They said they would always ask me before they tried to do any transactions. So I ordered them a credit card with their name on it the funny thing is it had my account number on it! Same credit card number as my credit card. I guess theyre really serious about me being on the hook for anything my friend would spend with their card. What I figured out though is, I would probably have the ability to "freeze" their card and keep it in that state until they came to me and asked for permission to use it and then I woud unfreeze it so they could buy what we  agreed on but the thing is, how do I know how much they are going to spend? That's the real problem. I'm on the hook for whatever they decide to spend when its in the unfrozen state. After a bit of thinking about it, I came to the realization that it would simply be easier for me to just keep my credit card to myself and if I want to buy them something I can do it that way.

You can have signed transaction that will allow for example to send coins only to selected address. You can make some such transactions upfront, sign it with your "freeze key" and then pick one of them, sign it with your "real key" and broadcast. Also, multisig can be combined with locktime if needed.

That's the problem with my credit card company though. When my card is in the frozen state, I can't even create transactions that a vendor would broadcast at a later time. Can you imagine that? They wouldn't even just take down my card information and give me 30 minutes to get home to my ultrasecure desktop airgapped computer to unfreeze my credit card. How dare they?

 

Additionally "freezing" usually requires a time component
There is some weird and inefficient way to "freeze" coins without any timelock, for example someone can start with some public key, add some nonce, and increment it until hitting some target. Then, it is possible for example to store that key in some safe place, but store only the starting point in the wallet. In this way, it is possible to unlock the key after redoing all computations, which takes time, so it is guaranteed that for example you need 2^48 operations to recover your key.

Yeah I tried that method with my credit card actually and it didn't work here's what happened. I put my credit card in a glass bottle and buried it in my garden. That way no one could ever use it, except me, right? Problem is someone somehow got ahold of my credit card number and used it to subscribe to some porn website. The credit card company was familiar with the porn website and contacted them to see if it was really me. Turns out, they don't know who it was but they can't prove it was me so I got my money back. But I sure am glad that my credit card company implemented this "freeze" feature because now I don't have to go digging it up in the garden everytime I want to use it.

Oh and I finally found out how someone got ahold of my card number too, they were just rummaging through some trash and found an old credit card statement it wasn't even the statement for my credit card though can you believe that? But the account numbers were close and they made a mistake typing in the card number off the trash they found and that typo ended up being bad news for me but as I said, the credit card company made me whole again. So it's all good.

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[larry_vw_1955]

So basically you want to prevent people who have private key of your Bitcoin address can't steal your Bitcoin while it's frozen.

 I mean after all that's how it works with my credit card. I lost it once and someone found it but since it was frozen, they couldn't use it AT ALL. Not only that but I didn't lose any money either. My credit line transferred over to the new card the credit card company issued me. And guess what? It was not the same card number as the old one, if that's any help. Dave in card services was really helpful. I told him i felt like an idiot for losing my card and he said no problem they understand and it happens don't worry about it.

 But on protocol level, how do you freeze the address and how node can verify that you're the owner the address?

Well, I can't really answer that about bitcoin but I know how it works with my credit card if that would help. they have a big database and in the tables, there's a field that can be marked with F for frozen or U for unfrozen. Everytime a transaction comes in, they pull up that record in the database for my card and check if the field is F or U. If it is F then it won't approve.

The only answer i can think is by creating cryptography signature from your private key.

OK. So it really can work is what you're saying?

[o_e_l_e_o]

It sounds like you could achieve the kind of set up you are looking for with a 2FA wallet. It's not exactly the same as freezing an address, but it would achieve a very similar outcome:

With your credit card, someone can steal your credit card or steal your credit card number, and not be able to spend your money unless they can also break in to your credit card account and hit the "unfreeze" button.

With a 2FA account, someone can steal your wallet file or steal your private key, and not be able to spend your coins unless they can also break in to your phone and access the 2FA code.

The downsides to this approach are that Electrum's 2FA charges an additional fee, but you could get around this by using a manual multi-sig set up. You also need your wallet and 2FA app (or both wallets if doing it yourself) to be on different devices, so the compromise of one device doesn't lead to the compromise of both factors/private keys needed to sign a transaction.

[DannyHamilton]

You are thinking of Bitcoin as an electronic payment system instead of as a currency.

If you have cash in your wallet in your back pocket, there is no way to "freeze" that.  If anyone get's their hands on your wallet, they can spend the cash that is in it.  The way you protect your cash from being spent is to do one of two things. You either make sure that the cash is always under your control (that nobody else has physical access to it), or you find a trusted third party (such as a bank) and you give it to them, trusting that they will make sure that the cash is always under THEIR control (using economy of scale, they can implement more expensive vaults, guards, security systems, and insurance than you can).

IF you choose to trust someone else (such as a bank) to maintain control of your funds, THEN they can provide a method for you to "lock" your account with them so that no transactions can occur until you perform some "unlocking" action.  Of course, if the thief can figure out out to perform the unlocking action, then they'll still be able to access the account.

This is exactly how Bitcoin works.

If you use your own wallet, and you have control of your private keys, then it is up to you to secure those private keys so that nobody else can access them. This is like cash in your back pocket, or in a small safe in your house, or hidden in a drawer somewhere in your house, etc.

If you choose to use a custodial service, then you can turn over complete control of your bitcoins to that service. That service can then make transactions on your behalf whenever you ask them to. You'll have to trust that they'll do a good job of securing the bitcoins that they are holding for you against both outside attackers and internal fraud. It would be easy for such a service to provide a "locking" method where they would refuse to create any transactions on your behalf until you perform an "unlocking" action. This is like depositing your cash into a service (such as a bank).

Coinbase already offers something like this with their 2FA system.  You can "lock" your Coinbase account with 2FA, and then they will refuse to send any transactions on your behalf unless you provide the appropriate 2FA value to "unlock" your account for that single transaction.

[kaggie]

If I wanted to I could click the freeze button again and put my card back into a deep freeze so that no one can use it even if they know the credit card #, expiration date and special number on the back of the card (call it a private key if you like). That's pretty amazing tech, don't you guys think?

Wouldn't transferring balances to and from that wallet/key be effectively the same thing?

I'm not sure how freezing would work without a higher authority, which would no longer be bitcoin.

[larry_vw_1955]

It sounds like you could achieve the kind of set up you are looking for with a 2FA wallet. It's not exactly the same as freezing an address, but it would achieve a very similar outcome:

I have 2FA set up with paypal, but it's a real pain in the ass. Everytime I login I have to go to my authenticator and get a 6 digit code. But I do it because someone actually logged into my paypal account once and tried to transfer alot of money straight out of my bank account to another country.

With your credit card, someone can steal your credit card or steal your credit card number, and not be able to spend your money unless they can also break in to your credit card account and hit the "unfreeze" button.

There's a very small chance they could not only get ahold of my credit card info and also manage to login to the credit card website into my account but that's REALLLLLY unlikely.

With a 2FA account, someone can steal your wallet file or steal your private key, and not be able to spend your coins unless they can also break in to your phone and access the 2FA code.

Well, I mean, 2FA is meant to protect my local wallet from getting hacked. I keep my computer in a dungeon basement with 15 inch thick steel walls and AR-15 rifles on each wall. That's what I use for making sure no one get my wallet file. Oh also I use Mcafee antivirus to keep out the hackers from invading my computer. I do keep my private seed on that computer which is connected to the internet though...

The downsides to this approach are that Electrum's 2FA charges an additional fee, but you could get around this by using a manual multi-sig set up.

 I'm sure TrustedCoin is legit but if they went out of business then I could be really screwed up. I'm sure they would try to do the right thing but no thanks.

You also need your wallet and 2FA app (or both wallets if doing it yourself) to be on different devices, so the compromise of one device doesn't lead to the compromise of both factors/private keys needed to sign a transaction.

Well yeah. I mean that's a good safety measure. People don't always do what you're suggesting but it certainly is in their best interest.

Coinbase already offers something like this with their 2FA system.  You can "lock" your Coinbase account with 2FA, and then they will refuse to send any transactions on your behalf unless you provide the appropriate 2FA value to "unlock" your account for that single transaction.

I trust coinbase with the $3 i earn here and there. nothing more. in general, i dont place too high a premium on exchanges. they are useful for getting crytpo but i like to get it the helll out of there asap.

What i say it won't work if you use private key for freeze/unfreeze address and spend your Bitcoin. The hacker who have your private key will simply unfreeze and spend your Bitcoin.

Yeah that's a good point. So what you're saying is we don't want the freeze/unfreeze feature to be solely dependant upon knowing the particular bitcoin addresse's private key. I think I see what you're saying. Now the question is, how are we going to implement it then ?


1) Bitcoin address X wants to add the freeze feature. So it generates a special bitcoin address F.

2) This new address F will control the state of address X.

3) When the user wants to freeze address X, they send a transaction to address X using a special opcode.

4) The first time a user freezes their address X using address F, miners will create a record in a special database that lists address X along with its related controlling address F. A flag field will be toggled to "1" which will represent the frozen state.

5) If a transaction is ever attempted from address X in the frozen state, miners will reject it because they will first consult their database and see that address X is in the frozen state. Assuming no other reasons for which the transaction would be invalid, they can provide an error code indicating the address is frozen and thus the transaction cannot be completed.

6) When the user wants to unfreeze address X, they just send a transaction to address X from address F using the same opcode.

7) Miners will update their database and update the record for address X by toggling its flag field to "0" which will represent the unfrozen state.

If a transaction is ever attempted from address X in the unfrozen state, miners will first consult their database and see that address X is in the unfrozen state and then continue to process the transaction as normal. If it passes all the other consensus rules then it will be accepted.

Do you guys think this would work? I spent the better part of a day coming up with it so I sure hope so! Let's turn this baby in to a BIP.
 













[moderator's note: consecutive posts merged]

[vjudeu]

If a transaction is ever attempted from address X in the frozen state, miners will reject it because they will first consult their database and see that address X is in the frozen state.

It can be easier than you think. No coin can be spent twice, so the only thing you need to "freeze" funds is just spending them. You can send coins to yourself, in this way the old address is "frozen", because coins can no longer be spent, but that second address can control freezing and unfreezing, because all you need to unfreeze your coins is just sending them back to the same address. Of course address reuse is a bad idea, so you can use fresh address from some HD wallet every time.

To control freezing and unfreezing you don't have to store private keys online. You can have some signed transactions prepared upfront and just broadcast them when you need.

Wouldn't transferring balances to and from that wallet/key be effectively the same thing?

Exactly, it would be the same.

[Pmalek]

Well I don't know about that but what I do know is it give me an incredible peace of mind knowing that because I clicked the freeze button, there is no transactions being done with my card. But the moment I need to, I can just click on unfreeze and do my business and then freeze it again, making it impervious to the outside world even if they know my card number and such. that's security, I tell you!

I don't have such a feature on my cards so I am not exactly sure how it works. I assume all you need to do to freeze/unfreeze your account is log in to your online banking account, enter your password or maybe a PIN and that's it. Although it's a good security feature, it isn't exactly high-tech. If someone stole your PIN/password/whatever you use to freeze/unfreeze your credit card, they could do it as well.

If you are concerned about someone being able to spend your digital assets by discovering your seed, why not extend it with a passphrase? No one would be able to steal your coins unless they have the passphrase as well. You can compare that seed extension to the password you use to freeze your credit card with.   

[larry_vw_1955]

I don't have such a feature on my cards so I am not exactly sure how it works. I assume all you need to do to freeze/unfreeze your account is log in to your online banking account, enter your password or maybe a PIN and that's it. Although it's a good security feature, it isn't exactly high-tech. If someone stole your PIN/password/whatever you use to freeze/unfreeze your credit card, they could do it as well.

Yeah I'm not sure all cards have that feature but mine does. I don't even have to enter any pin # or password or anything. I just click the 
"freeze" button at the top of the webpage once I am logged in and it's that simple. Then the button says "Unfreeze". These actions take place immediately. From my experience.

If you are concerned about someone being able to spend your digital assets by discovering your seed, why not extend it with a passphrase? No one would be able to steal your coins unless they have the passphrase as well. You can compare that seed extension to the password you use to freeze your credit card with.   

Well for one thing, I'm talking about an individual single bitcoin address. It doesnt have a seed or passphrase. What I'm talking about is making the utxos for a given address inactive. That's what freezing means to me.

It can be easier than you think. No coin can be spent twice, so the only thing you need to "freeze" funds is just spending them. You can send coins to yourself, in this way the old address is "frozen", because coins can no longer be spent, but that second address can control freezing and unfreezing, because all you need to unfreeze your coins is just sending them back to the same address. Of course address reuse is a bad idea, so you can use fresh address from some HD wallet every time.

My proposal makes the utxos inactive, unable to be spent until a certain action is performed first. Sweeping the address would just kick the can down the road in the sense that the utxos are basically still active and able to be spent but they just belong to a different address. That's not what "freezing" is all about.

Additionally, if someone had an address that had a large number of utxos it could be quite costly to transfer them all to a new address. With my proposal, they wouldn't have to do that. Because they are frozen in place. And the transaction that freezes them would be tiny. Thus costing as little as possible. And removing the real risk that they enter the destination address incorrectly and lose all their funds or they get some malware that changes their address and they lose everything. With my solution the bitcoins are never touched or moved anywhere.

Wouldn't transferring balances to and from that wallet/key be effectively the same thing?

Exactly, it would be the same.

Not at all the same. My proposal could easily be extended to offer multiple states in which even greater functionality would be possible. Say you had an address that had 10 bitcoins in it and you were worrried that someone might hack your private key and drain the funds in one fell swoop. Well, just put your address into a state which says they can only spend 0.01 bitcoin every 144 blocks (everyday). Since you don't usually spend more than that much in a single purchase, it won't affect you. But it would take a hacker quite a long time to drain all your funds. And you would probably notice it long before they got anything substantial from it. Since you check your balance at least once a week.

[moderator's note: consecutive posts merged]

[o_e_l_e_o]

I do keep my private seed on that computer which is connected to the internet though...

Then you need to stop worrying about some incredibly unlikely scenario in which someone breaks in to your house to physically access your computer to steal your coins, and start instead worrying about the fact that you are storing your seed phrase on an internet connected device. The latter is far more likely to result in your coins being stolen. This is like worrying about your seat belt being too loose while ignoring the fact that your brake pedal doesn't work.

I'm sure TrustedCoin is legit but if they went out of business then I could be really screwed up. I'm sure they would try to do the right thing but no thanks.

When setting up a 2FA Electrum wallet, you are still provided a seed phrase which will provide you with all the information necessary to sign a transaction on your own. Should TrustedCoin go out of business, you can simply restore a full wallet from your seed phrase and access your coins.

[larry_vw_1955]

Then you need to stop worrying about some incredibly unlikely scenario in which someone breaks in to your house to physically access your computer to steal your coins, and start instead worrying about the fact that you are storing your seed phrase on an internet connected device. The latter is far more likely to result in your coins being stolen. This is like worrying about your seat belt being too loose while ignoring the fact that your brake pedal doesn't work.

got you boss.

When setting up a 2FA Electrum wallet, you are still provided a seed phrase which will provide you with all the information necessary to sign a transaction on your own. Should TrustedCoin go out of business, you can simply restore a full wallet from your seed phrase and access your coins.

i'll definitely check that out boss. and just for my own enjoyment I hope you wouldn't mind if I assign a uuid to this thread so that I can use it for reference purposes. the entire thread i mean.

61842BEE-940A-40E5-9896-00B427E85790