Insecure Lightning Node? VLS Fixes This

Summary

Jack Raldi introduces the Validating Lightning Signer (VLS) project, a solution to enhance security in the Lightning Network by separating private keys from nodes to a hardened signing device. VLS validates transactions against Lightning Network rules before signing, preventing unauthorized transactions even if the node is compromised. The project is open-source, with a roadmap including features like tag team signing and disaster recovery. VLS is adaptable for various use cases, from mobile devices to large merchants, ensuring user control over private keys. The script also discusses Validity, a project leveraging secure enclaves for enhanced Bitcoin signing security, with VLS as its initial application.

Takeaways

• 🏌️ Jack Raldi challenges Donald Trump to a golf game with a $1 million charity bet for Bitcoin open source development.
• 🔒 The Lightning Network faces custody challenges due to reliance on cloud providers and custodial apps, which pose security risks.
• 💡 VLS (Validating Lightning Signer) aims to enhance security by separating private keys from the Lightning node to a hardened signing device.
• 🛡 VLS validates Lightning Network rules before signing transactions, preventing unauthorized transactions even if the node is compromised.
• 🔄 VLS is an open-source reference implementation, not a consumer product, and is designed for integration into other solutions.
• 🔗 VLS allows for flexible policies, such as velocity control and approval flows, to manage transaction authorization.
• 📱 VLS can be deployed on various devices, from mobile to large merchants' HSMs, ensuring user control over private keys.
• 🔄 VLS is seeking developers and has a roadmap including features like tag team signing, disaster recovery, and enterprise focus.
• 🔐 Validity, a new project funded by Spiral, focuses on integrating VLS with secure enclaves for enhanced security and policy enforcement.
• 🔗 The project aims for hardware that is open-source, self-sovereign, and widely available, with an initial focus on ARM architecture.

Q & A

What is the main challenge addressed by the Validating Lightning Signer (VLS) project?

The main challenge addressed by the VLS project is the custody and security risks associated with Lightning Network nodes, where most nodes are hosted on cloud providers and users often rely on custodial apps, which can present challenges with authorities and increased risk of funds loss if compromised.

What is the concept of a 'blind signer' in the context of the Lightning Network?

A 'blind signer' is a device that is separated from the main node and is responsible for signing transactions without validating them. This can actually reduce security because it introduces another potential attack point and blindly signs whatever the node asks it to, without verifying the transaction's legitimacy.

How does the Validating Lightning Signer (VLS) improve upon the blind signer model?

VLS improves upon the blind signer model by not only separating the user's private keys from their Lightning node to a separate hardened signing device but also ensuring that this device validates all of the Lightning Network rules before signing a transaction. This prevents unauthorized or malicious transactions from being signed, even if the node is compromised.

What is the role of the VLS in the context of a Lightning Network node?

The VLS acts as a secure, separate device that holds the user's private keys and validates all Lightning Network rules before signing transactions. It ensures that only legitimate transactions are signed, thereby protecting the user's funds even if the main Lightning node is compromised.

What are some of the features that VLS allows for in terms of transaction policies?

VLS allows for flexible policies such as velocity control, which can limit the amount of funds that can be sent per day, and setting up approval flows for different transaction amounts, allowing certain individuals or roles within an organization to approve transactions above a certain threshold.

Can you provide an example of a device that can run the VLS?

Examples of devices that can run VLS include mobile devices, inexpensive consumer devices like an ESP32 or an STM32, and more expensive options like HSMs or hardened servers. This flexibility allows for a wide range of use cases from individuals to large merchants.

What is the significance of VLS being an open-source project?

Being open-source means that VLS is a reference implementation that can be freely used, modified, and improved upon by the community. It allows other commercial products to incorporate its features into their own solutions, promoting innovation and widespread adoption of secure Lightning Network practices.

How does VLS contribute to the user's control over their private keys?

VLS contributes to user control by allowing the end user to hold their private keys on a separate, secure device, even if their node is hosted by a third-party service provider. This ensures that the user maintains control over their funds and can unilaterally close channels and recover their Bitcoins without the need for third-party involvement.

What is the roadmap for the VLS project in terms of future development?

The roadmap for the VLS project includes working on disaster recovery features, focusing on enterprise solutions, integrating VLS with secure enclaves, and eventually supporting multisignature lightning transactions, which are dependent on other developments in the Bitcoin ecosystem like Taproot, Frost, and MAST.

What is the Validity project and how does it relate to VLS?

The Validity project is an ambitious initiative enabled by a Spiral Grant, aiming to leverage secure enclaves for Bitcoin signing. In its initial phase, it focuses on integrating with VLS, as the secure enclaves require policies that restrict key usage, which VLS effectively provides. The project aims to create a prototype, reference implementation, and developer kit for integrating VLS with secure enclaves.