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Use final spec values for splicing #2887

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Use final spec values for splicing #2887

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@t-bast t-bast commented Jul 23, 2024

We replace our experimental version of splice_init, splice_ack and splice_locked by their official version (see lightning/bolts#1160). If our peer is using the experimental feature bit, we convert our outgoing messages to use the experimental encoding and incoming messages to the official messages.

We also change the TLV fields added to tx_add_input, tx_signatures and splice_locked to match the spec version. We always write both the official and experimental TLV to updated nodes (because the experimental one is odd and will be ignored) but we drop the official TLV if our peer is using the experimental feature, because they won't understand the even TLV field.

This guarantees backwards-compatibility with peers who only support the experimental feature.

@ddustin you should be able to start cross-compat tests based on this branch.

NB: builds on top of #2968

@t-bast t-bast force-pushed the splicing-official branch 2 times, most recently from 7d1c23e to 33482ec Compare August 1, 2024 14:34
@t-bast t-bast requested a review from remyers August 1, 2024 14:36
@t-bast t-bast force-pushed the splicing-official branch 2 times, most recently from fa51c31 to 2d350e5 Compare August 1, 2024 16:17
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remyers commented Aug 13, 2024

This is an observation that occurred to me while reviewing this PR that might be relevant for a future PR ..

There will be times when using CMD_BUMP_FUNDING_FEE instead of CMD_SPLICE would cost less on-chain and confirm faster if you want to perform an additional splice while a pending splice is unconfirmed. The total cost to create a new funding transaction with CMD_SPLICE will often be higher than making the same changes with CMD_BUMP_FUNDING_FEE at a slightly higher fee rate. If you are blocked from making a new splice because a pending splice has been fee bumped, you could also make a new fee bump to splice in/out value rather than waiting for the previously rbf'd splice to confirm.

This seems to be technically possible in the protocol because CMD_BUMP_FUNDING_FEE uses the interactive tx protocol and can change the funding contribution with the funding_output_contribution TLV. Figuring out if a splice or rbf-splice is cheaper will also need to consider the additional fees paid to bump our counter party's inputs and outputs.

Perhaps the biggest downside I can see (beside complexity) is that if your pending splice or rbf confirms before a rbf-splice, then you would need to renegotiate it as a new splice.

Am I missing something here wrt fee savings? Do you think it would be worth considering this situation now rather than later?

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t-bast commented Aug 13, 2024

Perhaps the biggest downside I can see (beside complexity) is that if your pending splice or rbf confirms before a rbf-splice, then you would need to renegotiate it as a new splice.

Yes, the main reason we're not providing this yet (even though this is in theory possible) is to manage complexity. It can get really complex very quickly once you start going down that road, because if each splice "part" maps to a specific action (e.g. an on-the-fly funding), it can be a huge mess to reconcile which parts where actually done and which parts need to be replayed if a previous RBF attempt confirms.

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Looks good - the refactor for RBF makes it easier to read/understand.

I found a few nits but main issues to take a look at are related to adding logic to reject an TxInitRbf or SpliceInit when the parent splice is unconfirmed.

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Changes to tests to disallow sequences of unconfirmed splices looks good. I only had a few minor nits/questions.

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t-bast commented Oct 8, 2024

Rebased to include changes linked to liquidity ads and on-the-fly funding.

Some on-the-fly funding tests aren't passing anymore, because it's harder to make eclair mimick the behavior of a wallet that doesn't contribute at all to funding transactions: we'll need to re-work those tests, I'm not sure yet what exactly will be best.

We will probably integrate the second and third commits independently, once we're confident Phoenix users all support quiescence. This should help us integrate this bit by bit and make sure test coverage is good enough.

We already use a minimum depth of 6 before announcing channels to
protect against reorgs. However, we allowed using the channel for
payments after only 3 confirmations (for small channels). A reorg
of 3 blocks that invalidates the funding transaction would allow
our peer to potentially steal funds. It's more consistent to use
the same depth for announcing the channel and actually using it.

Note that for wumbo channels, we already scaled the number of
confirmations based on the size of the channel.

For closing transaction, we don't need the same reorg safety, since
we keep watching the funding output for any transaction that spends
it, and concurrently spend any commitment transaction that we detect.
We thus keep a minimum depth of 3 for closing transactions.
We were still using values from before the halving. We update those
values and change the scaling factor to a reasonable scaling. This
protects channels against attackers with significant mining power.
Now that we wait for at least 6 confirmations before considering a
channel confirmed, we can simplify our channel announcement logic.
Whenever a channel reaches the confirmed state, it can be announced
to the network (if nodes wish to announce it). We thus don't need
the "deeply buried" state and the "temporary" scid anymore.

The logic is much simpler to follow: when the channel confirms, we
internally update the real scid to match the confirmed funding tx
and send our `announcement_signatures`. When we receive our peer's
`announcement_signatures`, we stash them if the funding tx doesn't
have enough confirmations yet, otherwise we announce the channel and
create a new `channel_update` that uses the real scid.

Whenever we create a `channel_update`, we simply look at whether the
channel is announced or not to choose which scid to use.

This will make it much simpler to announce splice transactions, which
don't need a "deeply buried" state either and will instead simply rely
on whether the splice transaction is confirmed or not to generate
`announcement_signatures`.
We now support splicing on public channels: once the splice transaction
is confirmed and locked on both sides, nodes will exchange announcement
signatures that allows them to create a `channel_announcement` that they
then broadcast to the network.

This requires reworking the data model to include the announcement and
the real `short_channel_id` in each commitment, which lets us cleanly
distinguish real `short_channel_id`s from aliases (which are set at the
channel level regardless of the current commitments).

The flow now becomes:

- when the funding transaction of a commitment confirms, we set the
  corresponding real `short_channel_id` in that commitment
- if the channel is public and we've received `channel_ready` or
  `splice_locked`, we send our `announcement_signatures`
- if we receive `announcement_signatures` for a commitment for which
  the funding transaction is unconfirmed, we stash it and replay it
  when the transaction confirms
- if we receive `announcement_signatures` for a confirmed commitment,
  and we don't have a more recently announced commitment, we generate
  a `channel_announcement`, store it with the commitment and update
  our router data

When creating a `channel_update` for a public channel, we always use
the `short_channel_id` that matches the latest announcement we created.
This is very important to guarantee that nodes receiving our updates
will not discard them because they cannot match it to a channel.

For private channels, we stop allowing usage of the `short_channel_id`
for routing: `scid_alias` MUST be used, which ensures that the channel
utxo isn't revealed.

Note that when migrating to taproot channels, `splice_locked` will be
used to transmit nonces for the announcement signatures, which will be
compatible with the existing flow (and similarly, `channel_ready` will
be used for the initial funding transaction). They are retransmitted
on reconnection to ensure that the announcements can be generated.
@t-bast t-bast force-pushed the splicing-official branch from 315c51b to 833acf9 Compare January 2, 2025 11:09
We replace our experimental version of `splice_init`, `splice_ack` and
`splice_locked` by their official version. If our peer is using the
experimental feature bit, we convert our outgoing messages to use the
experimental encoding and incoming messages to the official messages.

We also change the TLV fields added to `tx_add_input`, `tx_signatures`
and `splice_locked` to match the spec version. We always write both the
official and experimental TLV to updated nodes (because the experimental
one is odd and will be ignored) but we drop the official TLV if our
peer is using the experimental feature, because it won't understand the
even TLV field.

This guarantees backwards-compatibility with peers who only support the
experimental feature.
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