AtomicLightningExchange

AtomicLightningExchange enables trustless swaps between Lightning Bitcoin and on-chain Bitcoin using atomic swaps, eliminating the need for a centralized authority. Built with the Lightning Development Kit (LDK), it provides a command-line interface (CLI) to interact with a Lightning Network node. Key features include generating on-chain addresses, sending transactions, managing Lightning channels, and performing atomic swaps.

Warning

This project is a work in progress and requires rigorous testing before production use.

Security Concerns

• Private Key Storage: Node private key handling needs enhancement; consider using LDK's built-in methods.
• Timelock Validation: Before the redeemer sends funds, verify the CSV timelock against the current timestamp to prevent premature refunds.
• RPC Configuration: Update RPC endpoints in utils.rs and main.rs to mainnet Bitcoin for production.

Instructions

These instructions are for testing purposes only.

Starting a Lightning Node

Configure the make_node and run_node functions in main.rs to start a Lightning node. Use the following commands with test private keys (never use these in production):

# Start Alice's Lightning node on localhost:9000
cargo run --features alice

# Start Bob's Lightning node on localhost:9001
cargo run --features bob

Features

• On-Chain Operations: Generate addresses (getaddress), send transactions (onchaintransfer)
• Channel Management: Open (openchannel) and close (closeallchannels) Lightning channels
• Invoices: Create (getinvoice) and pay (payinvoice) Lightning invoices
• Information: View channel details (channelinfo) and balances (balance)
• Atomic Swaps: Swap on-chain Bitcoin and Lightning payments via HTLCs (atomicswapsend, atomicswapredeem, atomicswaprefund)

Atomic Swap Features

Atomic swaps facilitate trustless exchanges between on-chain Bitcoin and Lightning Network payments using Hash-Time-Locked Contracts (HTLCs). HTLCs ensure that either both parties complete the swap or neither does. The process locks Bitcoin in an on-chain HTLC, which the recipient redeems by revealing a preimage (from paying a Lightning invoice) or the sender refunds after a lock time expires.

In an atomic swap using Pay-to-Taproot (P2TR), the Taproot tree has two script leaves:

• Redeem Leaf: OP_SHA256 <secret_hash> OP_EQUALVERIFY <receiver_pubkey> OP_CHECKSIG
  Lets the recipient claim funds with a preimage matching the secret hash and their signature.

• Refund Leaf: <lock_time> OP_CSV OP_DROP <sender_pubkey> OP_CHECKSIG
  Lets the sender reclaim funds after a timeout (in blocks) with their signature.

These leaves form a Merkle root, tweaking an internal public key to create the P2TR address, ensuring the swap is atomic.

Commands

atomicswapsend <amount> <recipient_pubkey> <sender_refund_pubkey> <block_num_lock>

• Description: Starts an atomic swap by generating a Lightning invoice and locking <amount> satoshis in an on-chain HTLC.
• Parameters:
  • <amount>: Satoshis to lock (e.g., 80000)
  • <recipient_pubkey>: Recipient's public key
  • <sender_refund_pubkey>: Sender's refund public key
  • <block_num_lock>: Blocks until refund is possible (e.g., 100)
• Example:

  atomicswapsend 80000 456db773aa5c4cc6ed3a4780243d16bd58220be318702603b219fe79eceb848f fdfbf55076737c3b8e150ab1fcf138caa7a8671d2185695944c2581ef11aa866 100

atomicswapredeem <invoice> <amount> <recipient_pubkey> <sender_refund_pubkey> <block_num_lock>

• Description: Redeems the on-chain HTLC by paying the <invoice> and using the preimage to claim funds.
• Parameters:
  • <invoice>: Lightning invoice to pay
  • <amount>: Locked satoshis
  • <recipient_pubkey>: Recipient's public key
  • <sender_refund_pubkey>: Sender's refund public key
  • <block_num_lock>: Lock time in blocks
• Example:

  atomicswapredeem lntbs800u1pn742prdq5w3jhxapqd9h8vmmfvdjsnp4q0svv2k4d2ca24r4rprcgpma7mk3t6cltwduvxj8lannxqng2en7spp5rvnvxztdf23nw3cva4c9ztp3kpcq9t3cs8jg969238we290n9u7qsp5epugyv8yyhtzfjzg69kz0vsmzd44ztd5t83jrzwg7mr97rtpyhhq9qyysgqcqpcxqr94uy9s8xaa5rlw3an2h73c32wx4tryhdtud3cyyh9a2tqcxqhztz038p28ry3h0njt4axdajyp90deqsu6tgrns2pkqspy0t3gl78fp08spy37pc8 80000 456db773aa5c4cc6ed3a4780243d16bd58220be318702603b219fe79eceb848f fdfbf55076737c3b8e150ab1fcf138caa7a8671d2185695944c2581ef11aa866 100

atomicswaprefund <payment_hash> <amount> <recipient_pubkey> <sender_refund_pubkey> <block_num_lock>

• Description: Refunds the on-chain HTLC after <block_num_lock> expires if unredeemed.
• Parameters:
  • <payment_hash>: Invoice payment hash
  • <amount>: Locked satoshis
  • <recipient_pubkey>: Recipient's public key
  • <sender_refund_pubkey>: Sender's refund public key
  • <block_num_lock>: Lock time in blocks

Testing Private Keys

• Recipient Private Key: c929c768be0902d5bb7ae6e38bdc6b3b24cefbe93650da91975756a09e408460
• Sender Private Key: 8957096d6d79f8ba171bcce36eb0e6e6a6c02f17546180d849745988b2f5b0ee

Using Other Lightning Node Features

The CLI offers commands to manage your Lightning node beyond atomic swaps:

• getaddress: Get a new on-chain Bitcoin address.
  Example: getaddress

• onchaintransfer <address> <sats>: Send on-chain Bitcoin.
  Example: onchaintransfer tb1qexampleaddress 10000

• openchannel <node_id> <address> <sats>: Open a Lightning channel.
  Example: openchannel 02examplepubkey 127.0.0.1:9735 100000

• closeallchannels: Close all channels.
  Example: closeallchannels

• getinvoice <sats>: Create a Lightning invoice.
  Example: getinvoice 1000

• payinvoice <invoice>: Pay a Lightning invoice.
  Example: payinvoice lntb1u1exampleinvoice

• channelinfo: View channel details.
  Example: channelinfo

• balance: Check on-chain and Lightning balances.
  Example: balance

These commands let you handle on-chain transactions, channels, and invoices efficiently.

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