Bonded Exits

[AdityaSripal]

StartExit should require a bond proportional to the UTXO being exited to provide a stronger disincentive for invalid exit transactions and eliminates the burden on users to be vigilant of fraudulent exits from previous owners. Since a successful challengeExit will transfer the bond to the sender of the challengeExit transaction, one can broadcast their confirmSigs to "fraud bounty hunters" who can challenge fraudelent exits on the user's behalf and claim the bond as a reward.

• Blockchain @ Berkeley Researcher

[smartcontracts]

Is the bond necessarily a % of the exit? It seems like we just need to set bond >= cost of challenging (incl gas, labor, etc.) in order to properly incentivise challenges.

% of exit could become prohibitively large, but if it's necessary then that's acceptable.

[AdityaSripal]

I don't think it's necessary. The benefit of making the bond a % of exit is that large UTXO's get more attention from bounty hunters. The drawback as you said is that large UTXO's require large bonds. This may not be a big issue since people with a large UTXO in a plasma chain will most likely be able to put a fraction of it as a bond in the root chain, also the disincentive to cheat will also be proportional to the reward from a successful fraudulent exit which is a good thing

I think either way is fine.

[smartcontracts]

I think we just need to properly incentivise challenges in general and ensure that all exits can be challenged. As long as those two conditions are met it shouldn't matter how large the exit is.

[AdityaSripal]

For sure, I have two PR's up implementing both ways to bond. Up to you guys which you prefer.

I currently set a constant bond of 10000 Wei, but more work needs to be done to find out what the constant bond should be to reliably be higher than the gas cost of calling challengeExit.