Resources on Lightning privacy
Receiver privacy with LNproxy
lnproxy takes a bolt 11 invoice and generates a “wrapped” invoice that can be settled if and only if the original invoice is settled. The “wrapped” invoice has the same payment hash, expiry, and description, as the invoice it wraps but adds a small routing fee to the amount. The “wrapped” invoice can be used anywhere the original invoice would be used to trustlessly hide the destination of a payment.
use the API in your
.bashrc
(available in the Raspiblitz v1.9.0 and above with a CLI shortcut as well):Code and how to run yourself: https://github.com/lnproxy
Improved alias verifying the payment hash: https://github.com/lnproxy/lnproxy-cli
Unannounced channels - shadow liquidity
use parallel private channels to hide capacity and UTXOs
https://eprint.iacr.org/2021/384.pdf
To hide public channel balances, a node may open unannounced channels in parallel to announced ones. Depending on the relation between the balances of announced and unannounced channels, the attacker may still be able to discover unannounced channel balances (e.g., if the balance of the unannounced channel exceeds the balances of announced channels). Even in that case, the standard probing technique needs to be modified
Open channels with improved privacy
Manual
create channels from coinjoin outputs
private channels are not announced, use them especially if there is a public channel to the peer already
open one channel at a time
create no change
avoid round amounts
close cooperatively to an external address (eg a Joinmarket wallet running as a Maker))
Creating a Core Lightning channel funded by JoinMarket: https://gist.github.com/BitcoinWukong/0c04d9186251b0a6497fef3737e95ceb
syntax for LND with Balance of Satoshis:
Mutiny wallet
LDK / Sensei based
a new node for every channel open
fund channels with an external wallet and no change
LN-vortex
Coinjoin to channels: https://github.com/ln-vortex/ln-vortex
First mainnet transaction: https://twitter.com/benthecarman/status/1590886577940889600
Nolooking
Payjoin to channels. The receiver of a paymant can open channels in a payjoin.
LN wallets
Mobile wallets (LN node on the phone)
Tor support and private chain info
OBW - Tor + Electrum server support
optional custodial hosted channels support - payments are private from the provider
Breez - Tor and neutrino backend
Blixt - Neutrino block source
Custodial wallets
Traditional custodians provide no privacy from the maintainer.
Wallet of Satoshi
Bitcoin Beach Wallet (phone number required)
CoinOS (Liquid compatible LN <-> Liquid gateway)
LN compatible chaumian (blinded) mints
Cashu in browser - https://cashu.space , LNbits extension
Fedimint with LN gateways - WIP
LN protocol improvements
Attacks
Channel jamming
LNsploit
A Lightning Network exploit toolkit: https://www.nakamoto.codes/BitcoinDevShop/LNsploit
Probing
hiddenlightningnetwork.com - uses LDK to probe the lightning network to detect private channels
More details and conversation: https://lists.linuxfoundation.org/pipermail/lightning-dev/2022-June/003599.html
Reading list
Lightning privacy: from Zero to Hero https://github.com/t-bast/lightning-docs/blob/master/lightning-privacy.md
Mastering the Lightning Network chapter: https://github.com/lnbook/lnbook/blob/develop/16_security_privacy_ln.asciidoc
Current State of Lightning Network Privacy in 2021 - Tony https://abytesjourney.com/lightning-privacy
BOLT12 proposal https://bolt12.org
Make Lightning Payments Private Again (PLN)
Onion routing
BOLT #4: Onion Routing Protocol https://github.com/lightning/bolts/blob/master/04-onion-routing.md https://github.com/ellemouton/onion/blob/master/docs/onionRouting.pdf
Route Blinding proposal https://github.com/lightning/bolts/blob/route-blinding/proposals/route-blinding.md https://github.com/ellemouton/onion/blob/master/docs/routeBlinding.pdf
CLI tool for constructing & peeling onions both with and without route blinding. https://github.com/ellemouton/onion
Listening and videos
Privacy on Lightning - Bastien Teinturier - Day 2 DEV Track - AB21 https://bitcointv.com/w/2pXyaypeMThT5tM3MUWcgN
Lightning Privacy - Ficsor, Teinturier, Openoms - Day 2 DEV 2pXyaypeMThT5tM3MUWcgN https://bitcointv.com/w/xsj5AEx36Usqts8GuNw9b3
RecklessVR Cryptoanarchy weekend / HCPP20 : how and why to use bitcoin privately https://www.youtube.com/watch?v=NUlUQlgtWlM Slides: https://keybase.pub/oms/slides/Running_a_Lightning_Node_Privately.pdf
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