Damus
Big Barry Bitcoin · 1w
Where does ark sit on this then? Or statechains?
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Spark does not qualify as a second layer because a malicious server plus a malicious prior holder can collude to steal the coins any user receives via a swap (which is the common way to receive coins on Spark), if the malicious parties prepare their attack in advance. There is one caveat: if you go through Spark's deposit procedure and do *not* use a swap, the utxos you deposit cannot be stolen from you, because *you* are the only prior holder, so a malicious server can only send them back to *you.*

That said, I think Spark built their interface so that swapping in is the only option visible to end users, and only their corporate partners can use the non-swap options. But it's theoretically possible that some people might find a way to access it, e.g. by "becoming" one of their corporate partners, or if they make it available in the future.

Ark seems to qualify as a second layer, but only if users use it in a certain way. Ark users have the option to trust the server for the finality of their payments, and both implementations seem to encourage this, especially for mobile users. They encourage this through their UX (which seems to default to "Out Of Round" payments, which trust the server).

On a related note, Arkade's LN swap implementation seems to automatically trust the swap provider + the server not to do a chargeback, by revealing the htlc preimage to the swap provider as soon as it gets funded via an Out Of Round payment. It does not seem to allow users the option to wait for the funding tx to confirm in a round first, which means, from what I can see, all inbound LN payments on Arkade are custodial, at least temporarily (i.e. til you refresh your vtxos, which is often several weeks later).

It might sound like I am saying contradicting myself, saying Ark qualifies but then pointing out all the ways it doesn't. But the thing is, users have the *option* to use it in a self-custodial manner, even if the devs seem to discourage it. You *can* refuse to consider an inbound payment settled until you refresh that vtxo. And you *can* avoid using their LN swap implementation and just onboard via L1 for now. (Maybe someday a better LN swap implementation will come out that is actually self-custodial.)

Since users *can* use Ark self-custodially, I think it technically qualifies as a second layer, but I also think almost no one is really using Ark in a way that qualifies as using a second layer.
Big Barry Bitcoin · 1w
Yeah, when I asked about state chains, I had the old mercury in mind, not spark, but good to know sparks nuances better. But my understanding has been that there was a third party in both of these protocols, so I thought it would fail for that reason, but your answer is more nuanced than I expected...