Abstract
BIP70 is the Bitcoin payment protocol for communication between a merchant and a pseudonymous customer. McCorry et al. (FC 2016) showed that BIP70 is prone to refund attacks and proposed a fix that requires the customer to sign their refund request. They argued that this minimal change will provide resistance against refund attacks. In this paper, we point out the drawbacks of McCorry et al.’s fix and propose a new approach for protection against refund attacks using the Bitcoin multisignature mechanism. Our solution does not rely on merchants storing refund requests, and unlike the previous solution, allows updating refund addresses through email. We discuss the security of our proposed method and compare it with the previous solution. We also propose a novel application of our refund mechanism in providing anonymity for payments between a payer and payee in which merchants act as mixing servers. We finally discuss how to combine the above two mechanisms in a single payment protocol to have an anonymous payment protocol secure against refund attacks.
The full version of this paper is available at https://arxiv.org/abs/1807.01793 [3].
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Notes
- 1.
Bitcoin transactions use fresh addresses (address freshness) [5] to protect the privacy of the address owner as well as others.
- 2.
Previous transaction hash is 32 bytes, previous Tx-out index is 4 bytes, Tx-in script length is 1–9 bytes, public key is 33 bytes in compressed format, signature is 72 bytes, sequence number is 4 bytes.
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© 2018 International Financial Cryptography Association
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Avizheh, S., Safavi-Naini, R., Shahandashti, S.F. (2018). A New Look at the Refund Mechanism in the Bitcoin Payment Protocol. In: Meiklejohn, S., Sako, K. (eds) Financial Cryptography and Data Security. FC 2018. Lecture Notes in Computer Science(), vol 10957. Springer, Berlin, Heidelberg. https://doi.org/10.1007/978-3-662-58387-6_20
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