Shared Ownership of scarce bitcoin with Multi Signatures in the Lightning Network

Abstract

This thesis praxeologically defines the universal axiom of scarcity as the attribute of exclusivity and rarity of a good. Humans act in order to remove uneasiness by allocating scarce resources throughout time. An individual can acquire the just property right in a scarce good by either homesteading or exchanging it. Yet abundant non-scarce goods without exclusivity do not justify the need for resource allocation through property rights, as they are in the realm of mind and cyberspace. Bitcoin applies cryptography in order to emerge the scarcity of the unspent transaction output. Its scripting capability can define the property rights of non-simulated shared ownership between several individuals. This fundamental economic breakthrough can be applied in countless use cases to increase the security, efficiency and usability of libre sound money Bitcoin.

Structure

Introduction

PART I On Scarcity

1. Human Action
2. Exclusivity of Scarce Goods
3. Rarity of Scarce Goods
4. Liberty
   4.1 Private property
   4.2 Homesteading
   4.3 Mutually beneficial exchange
5. Slavery
   5.1 Autistic Intervention
   5.2 Binary Intervention
   5.3 Triangular Intervention
6. Communism
7. Non-scarcity
8. Libre Open Source Software
9. Fallacy of Intellectual Property
10. Non-scarcity of Cryptography
11. Scarcity of UTXOs
    11.1 Double Spending is Non-Scarcity
    11.2 Bitcoin Halving and Scarcity
    11.3 Full Nodes Define, Verify and Enforce Scarcity

PART II Shared Ownership

1. Basics of Bitcoin Script
   1.1 Pay to Public Key Hash
   1.2 Pay to Script Hash
   1.3 Pay to Witness Public Key Hash
   1.4 Pay to Witness Script Hash
2. Script OP_CHECKMULTISIG
3. Schnorr aggregated MuSig
4. Taproot
5. Shamir's secret sharing
6. Schnorr threshold signatures
7. Lightning Network
   7.1 2-of-2 lightning network payment channel
   7.2 n-of-n lightning network channel factories

PART III Use Cases

1. 1-of-2 Joint Spending
2. 2-of-2 Joint Saving
3. 2-of-2 Two-Factor Authentication
4. 2-of-3 Child Saving
5. 2-of-3 Buyer, Seller, Trust less Escrow
6. 2-of-3 Hot Wallet Security
7. 3-of-5 Low Trust Joint Funds
8. Transaction Output Commitments

Conclusion

License and Contribution

This Bachelor's thesis is written in an open source process, and published under the Creative Commons Attribution-ShareAlike 4.0 International License. If you'd like to contribute to the research and writing, please submit an issue or fork the repository, commit the changes on your own branch, and issue a pull request. I have 1001 questions and thank all the peers whom I can bother to ask. If you have a proposal, feedback or question, don't hesitate to reach out! Thank you very much for your support!

The thesis is due on July 1st 2019 and written under the direction of Prof. Dr. Bernd Kaltenhaeuser. The Declaration of Honor is signed here. It will be published for peer review in the Libertarians Scholars Conference.

Support

If you think that this research paper is of importance to you, your project and the Bitcoin network in general, please consider supporting this project. Mainly, contemplate the problem and share your ideas on how a solution can be implemented. If you know someone who is interested in this subject, feel free to share the link and all the information contained in the repository. If you'd like to give financial support, I very much appreciate every Satoshi you can spare to donate!

3GB2fALwyWpcBY98svyDfX6fVQp4rNfoQ5