To: ZmnSCPxj <ZmnSCPxj@protonmail.com>
References: <82d90d57-ad07-fc7d-4aca-2b227ac2068d@riseup.net>
 <CAPv7TjY9h8n-nK_CPiYCWYDcbXpT1gfRMQDgf9VUkcR532rxOw@mail.gmail.com>
 <VxL93WE7bDrK1riquTWTTEgJj9mDQ4W5CuhOgdnnDPeidw2ho6evVh4cLZLz0jEYMqejaD1tiLULVTXkNRbI5A7wSwV49qSwnXcTWCDJ96E=@protonmail.com>
 <cbf78f63-cf8c-c5d8-06ea-afc79aabc23c@riseup.net>
 <5LiZqpFxklAAbGFiiAE3ijRbIteODXKcHrXvGJ-qabgQj5hG8beFtHNbVZ-XUxETVwduJYz94UYuJGAPxBrbGeZpSClUtXYsPJBABfr03KM=@protonmail.com>
 <e724b4c5-9efd-66c4-163b-492f17cafd7d@riseup.net>
 <Sy14DpcFGdAYL95d7e6tfkOe87oY53tJReo9CYvPT5J3Gb85AqedMheq1NbfVKUXZtZrwZqwVV4wSztikgWBAgNfTh8J5h5gXC6HDMxvsNg=@protonmail.com>
 <27f05cf1-08b2-a281-75b7-5c035317d030@riseup.net>
 <NWnynWUGBlIOhDRYr50kwUc1NK_h-I5tM5q1rjONrC5DTBPFlzYSr1DbmaE4jZOkFB1FtToeZfE2CegIDVJ_6NMezvzcQJ7U3DXFs4yFv0c=@protonmail.com>
From: Chris Belcher <belcher@riseup.net>
Autocrypt: addr=belcher@riseup.net; prefer-encrypt=mutual; keydata=
 xsFNBFPk74oBEACzBLjd+Z5z7eimqPuObFTaJCTXP7fgZjgVwt+q94VQ2wM0ctk/Ft9w2A92
 f14T7PiHaVDjHxrcW+6sw2VI2f60T8Tjf+b4701hIybluWL8DntG9BW19bZLmjAj7zkgektl
 YNDUrlYcQq2OEHm/MGk6Ajt2RA56aRKqoz22e+4ZA89gDgamxUAadul7AETSsgqOEUDI0FKR
 FODzoH65w1ien/DLkG1f76jd0XA6AxrESJVO0JzvkTnJGElBcA37rYaMmDi4DhG2MY4u63VE
 8h6DyUXcRhmTZIAj+r+Ht+KMDiuiyQcKywCzzF/7Ui7YxqeAgjm5aPDU2E8X9Qd7cqHQzFM7
 ZCqc9P6ENAk5a0JjHw0d0knApboSvkIJUB0j1xDIS0HaRlfHM4TPdOoDgnaXb7BvDfE+0zSz
 WkvAns9oJV6uWdnz5kllVCjgB/FXO4plyFCHhXikXjm1XuQyL8xV88OqgDFXwVhKrDL9Pknu
 sTchYm3BS2b5Xq1HQqToT3I2gRGTtDzZVZV0izCefJaDp1mf49k2cokDEfw9MroEj4A0Wfht
 0J64pzlBYn/9zor5cZp/EAblLRDK6HKhSZArIiDR1RC7a6s7oTzmfn0suhKDdTzkbTAnDsPi
 Dokl58xoxz+JdYKjzVh98lpcvMPlbZ+LwIsgbdH4KZj7mVOsJwARAQABzR9DaHJpcyBCZWxj
 aGVyIDxmYWxzZUBlbWFpbC5jb20+wsF+BBMBAgAoBQJT5O+KAhsDBQkSzAMABgsJCAcDAgYV
 CAIJCgsEFgIDAQIeAQIXgAAKCRDvc06md/MRKS8jD/9P9fSYSIVjltL9brAMfIu7wJn0H0lX
 TbcuCM2uQitJ3BNxI3c7aq5dEby27u5Ud54otncDJuRPQVDKs6H7t1rInitgJ1MTQ9/aQGFA
 btKcgtVIMFbeClzTTfWr4W7fE45NI7E9EANgk5JfmWh3U+KINYLF5RtqynYocrsP6zOV+G9A
 HCpBemd9TN60CoMLMyMzTHEW1oQffaVAXY8DgthEYO/odWYIod7VTmEm0zU1aSysPqMwPWNm
 8XIl0f8SfKQyZlAU8e1eCFVCenkE44FKC5qQNYc2UxexEYtfCWChTGc4oHKxIyYmTCCefsQF
 LvgwtvlNHRXHSDKSPSNcRcpl8DFpNEKrmMlkJ8Mx+YR05CydlTQ0bI3FBohJC+UHrjD5I3hA
 wJUC1o+yVSOEd+zN3cG1EECIwkEQSmBgG5t/le2RdzfXOdpf9ku2/zoBpq00R54JxUKlfRM7
 OPTv7X+1AKHkxOySdCZwGgvdh2Whuqs4kTvtco00gCFM9fBd5oi1RJuHtxHsj8+/XU15UItb
 jeo96CIlM5YUeoRLPT5mxZYWgYAARFeSFReNq/Tuwq9d8EokUrtAyrPayznliy53UJfWDVzl
 925c0Cz0HWaP2fWj+uFcj/8K0bhptuWJQy0Poht1z3aJC1UjEgr1Xz8I7jeSJmIlA9plcJw2
 k4dhWc7BTQRT5O+KARAAyFxAM28EQwLctr0CrQhYWZfMKzAhCw+EyrUJ+/e4uiAQ4OyXifRr
 ZV6kLRul3WbTB1kpA6wgCShO0N3vw8fFG2Cs6QphVagEH8yfQUroaVxgADYOTLHMOb7INS8r
 KI/uRNmE6bXTX27oaqCEXLMycqYlufad7hr42S/T8zNh5m2vl6T/1Poj2/ormViKwAxM+8qf
 xd8FNI4UKmq2zZE9mZ5PiSIX0qRgM0yCvxV39ex/nhxzouTBvv4Lb1ntplR/bMLrHxsCzhyM
 KDgcX7ApGm+y6YEsOvzw9rRCRuJpE4lth8ShgjTtNTHfklBD6Ztymc7q7bdPWpKOEvO5lDQ6
 q8+KfENv862cOLlWLk7YR2+mHZ1PXGhWC7ggwEkfGJoXo0x8X+zgUKe2+9Jj4yEhfL0IbFYC
 z2J5d+cWVIBktI3xqkwLUZWuAbE3vgYA4h8ztR6l18NTPkiAvpNQEaL4ZRnAx22WdsQ8GlEW
 dyKZBWbLUdNcMmPfGi5FCw2nNvCyN6ktv5mTZE12EqgvpzYcuUGQPIMV9KTlSPum3NLDq8QI
 6grbG8iNNpEBxmCQOKz2/BuYApU2hwt2E44fL8e6CRK3ridcRdqpueg75my6KkOqm8nSiMEc
 /pVIHwdJ9/quiuRaeC/tZWlYPIwDWgb8ZE/g66z35WAguMQ+EwfvgAUAEQEAAcLBZQQYAQIA
 DwUCU+TvigIbDAUJEswDAAAKCRDvc06md/MRKaZwD/9OI3o3gVmst/mGx6hVQry++ht8dFWN
 IiASPBvD3E5EWbqWi6mmqSIOS6CxjU0PncxTBPCXtzxo/WzuHGQg/xtNeQ0T8b2lBScZAw93
 qm1IcHXLUe5w/Tap6YaDmSYCIZAdtbHzYfPW4JK7cmvcjvF8jhTFOBEOFVQkTi19G7caVot0
 +wL1e2DRHDXAe5CinEpaLBlwHeEu/5j6wc3erohUZlK9IbAclj4iZTQbaq3EyqUXl59dBOON
 xmL5edJxzVishIYQGIyA9WP1SylXt+kO82NEqZG2OxdXAlzjuJ8C2pAG+nbLtDo4hcsiN/MA
 aX9/JB7MXclT5ioerF4yNgKEdfq7LmynsTUd8w/Ilyp7AD+BWoujyO94i8h9eKvjf9PvSwxQ
 uAjRpxne7ZJD8vCsMNXBHSbeEK2LiwStHL/w473viXpDD53J6OLxX6a5RummR+rixbMH7dgK
 MJQ7FlyDphm3or6CSkGEir1KA0y1vqQNFtHhguFapAWMDKaJjQQNgvZUmOo6hbZqmvUF1OWc
 d6GA6j3WOUe3fDJXfbq6P9Jmxq64op887dYKsg7xjQq/7KM7wyRcqXXcbBdgvNtVDP+EnzBN
 HyYY/3ms4YIHE5JHxQ9LV4yPcWkYTvb1XpNIFVbrSXAeyGHVNT+SO6olFovbWIC3Az9yesaM
 1aSoTg==
Message-ID: <d80b7ab5-d5f8-2289-ddf3-ffa7bbc6e5da@riseup.net>
Date: Wed, 10 Jun 2020 12:19:53 +0100
MIME-Version: 1.0
In-Reply-To: <NWnynWUGBlIOhDRYr50kwUc1NK_h-I5tM5q1rjONrC5DTBPFlzYSr1DbmaE4jZOkFB1FtToeZfE2CegIDVJ_6NMezvzcQJ7U3DXFs4yFv0c=@protonmail.com>
Content-Type: text/plain; charset=utf-8
Content-Language: en-US
Content-Transfer-Encoding: 7bit
Cc: Bitcoin Protocol Discussion <bitcoin-dev@lists.linuxfoundation.org>
Subject: Re: [bitcoin-dev] Design for a CoinSwap implementation for
 massively improving Bitcoin privacy and fungibility
Precedence: list

Hello ZmnSCPxj,

On 10/06/2020 11:58, ZmnSCPxj wrote:
> Good morning Chris,
> 
>>> Let me propose an alternative: swap-on-receive+swap-on-change.
>>
>> That's an interesting point, thanks for the thought. This scheme might
>> not be appropriate for every threat model and use case.
>> For example, if someone wants to use bitcoin just as a foreign currency
>> for its privacy and censorship-resistant properties. So for example if
>> they want to pay for a VPN anonymously, so they buy bitcoins and
>> immediately send all of them to the VPN merchant. The swap-on-receive
>> wouldn't be appropriate for them because they'll be doing a coinswap
>> straight away to the VPN merchant. So perhaps this plan could be an
>> optional mode of operation (which may or may not be the default). The
>> scheme obviously is useful when bitcoin is being used more as a
>> day-to-day money.
> 
> 
> No, I think you misunderstand my proposal.
> 
> If the user is doing swap-on-receive, the user already has an anonymous UTXO, they can just transfer it directly in full to the VPN without using a CoinSwap.
> 
> The number of CoinSwaps involved is the same: one.
> 
> So the difference is:
> 
> * swap-on-receive:
>   * I get some coins from an exchange, giving them my contact information and bank information and all the places I have ever inhabited in my entire existence and an unfertilized egg sample and an archive of my diary and let them invasively scan my cognitive substrate.
>   * I send the coins to my CoinSwap wallet.
>   * The CoinSwap wallet automaticaly CoinSwaps the coins into a new UTXO.
>     * One CoinSwap.
>   * I tell the CoinSwap wallet to send it all to the VPN.
>     * My CoinSwap wallet knows my coins are already cleaned, so it creates a plain 1-input 1-output transaction directly to the VPN address.
> 
> * swap-on-pay:
>   * I get some coins from an exchange, giving them my contact information and bank information and all the places I have ever inhabited in my entire existence and an unfertilized egg sample and an archive of my diary and let them invasively scan my cognitive substrate.
>   * I send the coins to my CoinSwap wallet.
>   * I tell the CoinSwap wallet to send it all to the VPN.
>     * My CoinSwap wallet automatically arranges a CoinSwap into the VPN address.
>       * One CoinSwap.
> 
> So in both cases the same expected number of CoinSwaps is done, i.e. one.
> 
> Note that there are still details like how much onchain fees are and how much CoinSwap maker fees are and etc etc but they exist for both flows anyway.
> So I would still be buying slightly more than my target amount, and if there is any change I could just designate it to be added to the mining fees or a donation to ZmnSCPxj, because ZmnSCPxj is so awesome.
> 
> What swap-on-receive+swap-on-change instead does is just amortize the timing of the CoinSwaps, so that you CoinSwap as soon as you receive, instead of as soon as you have to pay, so that sending payments is as fast as non-CoinSwap onchain wallets.
> 
> 
> Regards,
> ZmnSCPxj
> 

Right, I get it. Good explanation.

In your swap-on-receive example the exchange also can't tell how long
your coins remain unspent in your wallet, which they could in
swap-on-pay. This is very useful information for an exchange because it
tells them about what hodlers are doing, and they might trade against
them. (e.g. opening big short positions right after they see many long
term hodl'd coins being moved)