Ethical Transparency in Hush v3

Ethical Transparency in Hush v3

Business Crypto Market
September 18, 2019 by admin
197
hush transparency

Ethical Transparency in Hush v3

Moving to the new Hush mainnet has presented a number of new challenges and opportunities for Hush that we need to address. The two we want to talk about today are the opportunity to address the original Hush pre-mine and the Hush funds that were stolen from Cryptopia.

Pre-Mine

The original Hush pre-mine was in the amount of 160,000 HUSH. While pre-mining may have been common at the time Hush v1 was implemented (2016 — eons ago in cryptocurrency years!) the existing team does not support the practice. Since no one on the existing project had anything to do with the original decision — or received any funds from it — we are choosing to “burn” funds in the same amount. We don’t feel those funds belong to the team as it exists today nor should they be in circulation.

We are going to “burn” 160,000 HUSH, which will be visible to anyone on the explorer.

Burning an equal amount of HUSH as the original pre-mine will mean:

  • 0.76% of total supply (160K of 21M) (which is the same as the pre-mine % of total supply)
  • 2.3% of current circulating supply (as of today) which is 160000 / 6960017
  • current circulating supply is 6.9M HUSH

What “burning” funds means

What happens if you were to drop cash on the ground on a busy street without noticing? Likely, someone would pick it up and spend it elsewhere, right? But what happens if you were to light a fire to that cash instead? It would no longer be available for anyone to spend — ever.

So how do you ‘light a fire’ to cryptocurrency? One way (and one of the easiest) is to use the coin’s “zero address.” Each coin (or, more specifically, each address format*) has a zero address. You can know the zero address (since the public key is 0) but since an all 0 public key is not a valid field element it can’t have a private key.

Additionally, zero addresses are rejected by software (like wallets) thanks to standard protection measures like error checking and address format verification. Funds sent to a zero address are never retrievable or spendable. They have the added benefit of being recorded on the blockchain so the transaction is verifiable.

However, using a zero address forces full nodes to keep track of those inaccessible funds. This increases RAM use which people understandably get upset about. A better way is to remove those funds completely also in a verifiable way. To do this we need to go deeper than the address level — into the Bitcoin protocol itself.

There is a field called OP_RETURN that transactions can use. In order for funds to be spendable this field must evaluate to TRUE. When it evaluates to FALSE the funds can never be spent. Mathematically, it can never be restored to TRUE after this. Nodes understand the transaction is actually data (and not funds to keep track of) and it is “pruned” from memory going forward so all nodes can do less work. This allows us to store the transaction data itself (read: burn funds) in the blockchain rather than a financial amount in an unusable address that has to be tracked by nodes.

Cryptopia

In 2018 there was a 51% attack on Cryptopia resulting in a lot of HUSH being stolen from their users. As a Komodo (KMD) asset chain, Hush mitigates 51% attacks using Delayed Proof of Work (dPoW). dPoW uses a Proof of Work protocol (which is used by Bitcoin) but adds an additional step that notarizes blocks. Because of the move to the new blockchain we were able to opt not to airdrop those funds to the malicious address. When we realized this would be an option we immediately started talking to Cryptopia about returning those funds so that they could return them to individual investors. Unfortunately before that could happen Cryptopia went under.

Because Cryptopia holds the private keys to each account there is simply no way for investors to prove to Hush they are the original owners, although many have tried. Imagine how many “long lost cousins” you’d have knocking at your door if you won the lottery. We are unable to return those funds to the rightful owners and we aren’t going to send them to the attacker. (Technical note: they still exist on the now-defunct v2 blockchain.)

So Hush is deciding to re-invest those funds back into the community.

  • zelcashZelCash (ZEL) $ 0.045699 2.63%
  • ycashYcash (YEC) $ 0.272465 3.89%
  • bitcoinzBitcoinZ (BTCZ) $ 0.000108 9.57%
  • bitcoin-privateBitcoin Private (BTCP) $ 0.119406 5.32%
  • hushHush (HUSH) $ 0.070457 0.05%
  • snowgemSnowGem (XSG) $ 0.018750 0.38%
  • bithereumBithereum (BTH) $ 0.008934 21.36%