Hello Gregory,

Thanks for you feedback.

The BIP has been updated to explicitly specify the multiparty key derivation scheme which hopefully addresses your concerns.

Please have a look at the updated draft of the BIP at the link below:

https://github.com/commerceblock/pay-to-contract-protocol-specification/blob/master/bip-draft.mediawiki

Any feedback is highly appreciated.

Regards,

Omar

On Tue, Aug 15, 2017 at 7:40 PM, omar shibli <omarshib@gmail.com> wrote:

Thank you for your time Gregory, I really appreciate that.

What we are describing here is a method to embed cryptographic signatures into a public key based on HD Wallets - BIP32.

In a practical application, we should have two cryptographic signatures from both sides, I don't think in that case your scenario would be an issue.

More specifically in our application, we do the following construction:

contract base: m/200'/0'/<contract_number>'

payment base (merchant commitment): contract_base/<merchant_contract_signature>

payment address (customer commitment): contract_base/<merchant_contract_signature>/<customer_contract_signature>

payment address funds could be reclaimed only if the customer_contract_signature is provided by the customer.

In terms of durability, our app is pretty simple at this point, we don't store anything, we let customer download and manage the files.

I will update the BIP to address your concerns.

On Tue, Aug 15, 2017 at 8:12 AM, Gregory Maxwell <greg@xiph.org> wrote:

This construction appears to me to be completely insecure.


Say my pubkey (the result of the derivation path) is P.

We agree to contract C1.   A payment is made to P + G*H(C1).

But in secret, I constructed contract C2 and pubkey Q and set P = Q + G*H(C2).

Now I can take that payment (paid to Q + G*(C1) + G*H(C2)) and assert
it was in act a payment to P' + G*H(C2).   (P' is simply Q + G*H(C1))

I don't see anything in the proposal that addresses this. Am I missing it?

The applications are also not clear to me, and it doesn't appear to
address durability issues (how do you avoid losing your funds if you
lose the exact contract?).

On Mon, Aug 14, 2017 at 6:05 AM, omar shibli via bitcoin-dev
<bitcoin-dev@lists.linuxfoundation.org> wrote:
> Hey all,
>
> A lot of us familiar with the pay to contract protocol, and how it uses
> cleverly the homomorphic property of elliptic curve encryption system to
> achieve it.
> Unfortunately, there is no standard specification on how to conduct such
> transactions in the cyberspace.
>
> We have developed a basic trade finance application that relies on the
> original idea described in the Homomorphic Payment Addresses and the
> Pay-to-Contract Protocol paper, yet we have generalized it and made it BIP43
> complaint.
>
> We would like to share our method, and get your feedback about it, hopefully
> this effort will result into a standard for the benefit of the community.
>
> Abstract idea:
>
> We define the following levels in BIP32 path.
> m / purpose' / coin_type' / contract_id' / *
>
> contract_id is is an arbitrary number within the valid range of indices.
>
> Then we define, contract base as following prefix:
> m / purpose' / coin_type' / contract_id'
>
> contract commitment address is computed as follows:
> hash document using cryptographic hash function of your choice (e.g. blake2)
> map hash to partial derivation path
> Convert hash to binary array.
> Partition the array into parts, each part length should be 16.
> Convert each part to integer in decimal format.
> Convert each integer to string.
> Join all strings with slash `/`.
> compute child public key by chaining the derivation path from step 2 with
> contract base:
> m/<contract_base>/<hash_derivation_path>
> compute address
> Example:
>
> master private extended key:
> xprv9s21ZrQH143K2JF8RafpqtKiTbsbaxEeUaMnNHsm5o6wCW3z8ySyH4UxFVSfZ8n7ESu7fgir8imbZKLYVBxFPND1pniTZ81vKfd45EHKX73
> coin type: 0
> contract id: 7777777
>
> contract base computation :
>
> derivation path:
> m/999'/0'/7777777'
> contract base public extended key:
> xpub6CMCS9rY5GKdkWWyoeXEbmJmxGgDcbihofyARxucufdw7k3oc1JNnniiD5H2HynKBwhaem4KnPTue6s9R2tcroqkHv7vpLFBgbKRDwM5WEE
>
> Contract content:
> foo
>
> Contract sha256 signature:
> 2c26b46b68ffc68ff99b453c1d30413413422d706483bfa0f98a5e886266e7ae
>
> Contract partial derivation path:
> 11302/46187/26879/50831/63899/17724/7472/16692/4930/11632/25731/49056/63882/24200/25190/59310
>
> Contract commitment pub key path:
> m/999'/0'/7777777'/11302/46187/26879/50831/63899/17724/7472/16692/4930/11632/25731/49056/63882/24200/25190/59310
> or
> <contract_base_extended_pub_key>/11302/46187/26879/50831/63899/17724/7472/16692/4930/11632/25731/49056/63882/24200/25190/59310
>
> Contract commitment pub key:
> xpub6iQVNpbZxdf9QJC8mGmz7cd3Cswt2itcQofZbKmyka5jdvQKQCqYSDFj8KCmRm4GBvcQW8gaFmDGAfDyz887msEGqxb6Pz4YUdEH8gFuaiS
>
> Contract commitment address:
> 17yTyx1gXPPkEUN1Q6Tg3gPFTK4dhvmM5R
>
>
> You can find the full BIP draft in the following link:
> https://github.com/commerceblock/pay-to-contract-protocol-specification/blob/master/bip-draft.mediawiki
>
>
> Regards,
> Omar
>

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