This is not true. Anyone can just close the channel and make an on-chain transaction to get his balance on-chain in the next block.
Then he can just sign a message.

IMO, this is the best way.


Good question.

I never tried to do this, but looks like there is a way to sign a message from your node private key using eclair:
https://acinq.github.io/eclair/#signmessage

This isn't publicly available (unless one of the participating nodes makes it - like by publishing it on a website).

All a signed message proves is that you control an address with a certain amount of bitcoin on it. You'd either have to close the channel, sign an old address that funded the channel or sign the new one that is used in part of the channel.

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For standard wallets, you might also be able to test inbound capacity but it's not possible to know if someone's using a "standard" wallet.

Also, you could just get them to send a payment to prove ownership (even with a code in the amount of coins they send).

I do not know much about how to sign a message using lightnings network, but if you are having your own node, you should be able to sign a message. I have not done this before, but let us find out if it is helpful for you.

https://lightningnetwork.plus/sign_messages

As for me, I will still prefer to just use my bitcoin address to sign a message. You can use light client like electrum. You can just close the channel and sign the message with your bitcoin address.

I am thinking I can request the owner of the lightning node to first sign a message via node's secret key to proof ownership of the node. Then, I can request the node owner to provide all the "commitment transactions" so far and since these transactions use HTLC, these transactions are pretty much "linked" via secrets and hashes.

Hence, when we need to proof ownership/balances in a channel at a specific time, I can request the node owner to create a new "commitment transaction" and use the previous "commitment transactions" to proof it is not just a random or a fake "commitment transaction".

Do you guys think this is feasible?



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I just found a channel tool (https://github.com/guggero/chantools). This might be helpful.
This tool provides helper functions that can be used to rescue funds locked in lnd channels in case lnd itself cannot run properly anymore. It has a command called dumpchannels (dump all channel information from an lnd channel database).

@Rath

If all the "commitment transactions" information provided by the lightning node owner was open to public. Yes, someone who is malicious would be able to do the replay attack and the channel partner would publish a penalty transaction.

What if the "commitment transactions" information was sent to me only (assuming I am honest and trustworthy). Do you think this is the best way to proof ownership of funds in a lightning channel?

That's right. If I just simply ask Alice to provide latest state of their channel, I cannot prove the true state. How about this, I would ask Alice to make a specific commitment transaction, for example I would require Alice to transfer 0.0012345 btc between 22:00 and 22:05 on 07/15/2022.
And provide this commitment transaction to me.

I agree with the others:
[1] No, you cannot prove ownership of a certain amount of BTC like you can on L1.
[2] I wouldn't recommend anyone to send channel state commitments to anyone else than their channel partner.

That's a pretty big assumption that could cost channel partners their whole balance if you were to (mistakenly or not - Bitcoin don't care, and it's irreversible, immutable, right..) publish one of those commitments.

Also do keep in mind it will be a pretty annoying TOCTOU problem. Sure, even on L1, you could check someone's balance and just 10 minutes later it could be different. However in Lightning, this can change hundreds of times per minute or maybe even per second. I could lend 1BTC from someone through Lightning, make a snapshot of my channel states, immediately return the funds and send you the (now outdated) channel state, making you believe I own 1BTC while I don't.

There's just no way to check if the channel state was updated, since this information is private by design.

This is exactly the point.

That "proof" wouldn't prove anything.

What @BrutalBear is trying to do is to give a proof of some BTC he owns, but in fact he doesn't own any BTC on the blockchain yet.

If someone want to make a proof of funds, those funds must be on blockchain, with at least 3-6 confirmations. That is the only way.

@BlackHatCoiner

What if they gave us commitment #2 (revoked), which we can prove them and channel peer signed. And then they gave us commitment #3 (not revoked), which we can prove the channel peer signed. And commit 3 can be proved be to the next commitment after commit 2. We could prove commit 3 and “roll back” to commit 2 to prove balances at that time?