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      "body": "https://cdn-images-1.medium.com/max/900/1*N6EvmjMl-QfR9CqMvMXf-g.jpeg\n\nOver the last few years we have seen the rapid uptake of encrypted messengers like WhatsApp, Wickr, and Signal, and an increase in the availability of encrypted conversations in Telegram and Facebook Messenger. This adoption has been successful because these companies have been able to deliver a comparable user experience to un-encrypted messengers. Although many Person to Person chats are now using encryption, chat applications have struggled to replicate this in the context of group chats.\n\nThere are a number of ways Loki Messenger can accomplish encrypted group messaging. Broadly speaking, there are two main ideas that must be considered when designing the Loki Group Messaging architecture:\n\n**1. ) Scaling — How intensive is the proposed scheme on the Service Node network and the messaging clients?**\n\n**2.) Encryption — How secure is the channel, and what features does the proposed scheme have? What impact does the proposed scheme have on scalability?**\n**How we approach these two factors will determine the way users interact with the system, and based on our research there are several options available. **\n\nIn this article, we use some terms that you may not be familiar with:\n\n* Synchronous Messaging: Also known as ‘online’ messaging — where the parties must be online and actively interacting in order to send and receive messages.\n* Asynchronous Messaging: Also known as ‘offline’ messaging — where the parties do not have to be online in order to send and receive messages.\n* Client Side Fanout: A message must be sent from the client to a number of other users in the group chat.\n* Server Side Fanout: A message must be sent to a server, which then sends the message to all participants of the group chat.\n\nFor messaging with only two participants, Loki Messenger has both an Asynchronous mode using Swarm storage on the Service Node network, and a faster Synchronous mode which allows users to send messages directly to each other via Lokinet.\n\nWith that explained, let’s move on to the potential schemes:\n\n## Scaling\n\n**Full P2P**\n\nThis scheme is similar to the Tox model, where a central server is never established. In a fully P2P (Peer to Peer) propagation scheme, the members of a group must send messages to all other members of the group. In Tox, this is done by arranging the public keys of the members in the group into a ring, and each message is sent to the two mathematically closest members to the sender’s public key. Those peers should then repeat the process until the message is propagated across the entire group. [1] This protocol could also be extended so that users who were offline for a period of time could request the group chat history from a member in the group.\n\nThe issue with fully P2P systems is that they can be inefficient and are often unreliable. For example, if I create a group chat with two friends and both of them are offline, there is no way for me to send a message that they will get when they come online since there is no storage server — which is the major disadvantage of Synchronous messaging. Additionally, P2P messengers, including Tox, usually rely on some version of Client Side Fanout. For example, if I am in a large group of 200 people and I want to send a message to the group, the cumulative bandwidth consumption of that message is highly inefficient for client devices — when compared with Server Side Fanout.\n\n## Service Node Storage\nIn this model, any Service Node could be elected as a central server for the group chat. Users could establish a unique code specific to their group chat which would dictate which Service Node was responsible for storing messages. This code would then be given to each new user who wanted to join the chat.\n\nThe Service Node model is highly scalable since each user only needs to send their message to the Service Node once, before it can be requested by the other participants in the group.\n\nHowever, there are a few issues with this model. Firstly, the redundancy of the message storage is reduced as the group becomes reliant on a single Service Node remaining online. This could be remedied by delegating group messaging to Service Node Swarms, however that would burden the Service Node network as the node would have to manage and store a high volume of messages to provide redundancy for the group. It’s possible this could be combated by requiring payment to the Service Node network, or multi-output payment to the Swarm, when the group is created.\n\n## User Hosted Server\nIn this approach, Loki Messenger would allow the introduction of a simple storage server [2] which a user could host inside Lokinet (practically a SNApp). This server would give the operator a .loki address, and other users could use this address to access the operator’s server.\n\nWith the addition of Loki Name Service (LNS), this .loki address could become a human readable name like “Protests.loki,” and higher powered servers could allow users to host large chat rooms with a single domain and server.[3] Additionally, through LNS, the operator could add subdomains, for example “paris.Protests.loki”. These subdomains give the ability for one host to create multiple rooms within their single server, all with separate group encryption keys so the host cannot eavesdrop on conversations within rooms. Each subdomain costs the price of a single name registration on LNS, and users would be able to negotiate payment with the server operator if they require a new room.\n\n![0_HgJ0m-X2kyHi0eeO.png](https://cdn.steemitimages.com/DQmNpp8EK2ovcv3s7pPeMjsSshaXPwcaxmXP1v8xG18d4EJ/0_HgJ0m-X2kyHi0eeO.png)\n\nThis option scales well compared to the other options, since each server operator provisions their own level of service depending on how many users they serve, and there is no additional stress put on the Service Node network to store copies of every message for each member of the group. However, User Hosted Servers also introduce an element of trust — the user must trust the operator to reliably store their messages. Though metadata, the major vector of passive attack when using a central server, is removed, as messages are stored on the server using onion routing (Lokinet).\n\nIt also opens some much larger questions about how malleable we can make the messaging protocol, and whether opening the protocol restricts the speed of development. [Reflections: The Ecosystem is Moving](https://signal.org/blog/the-ecosystem-is-moving/), by one of the Signal founders, discusses this problem in detail.\n\n## Encryption\nNow that we have covered some of the challenges with scaling, we should also investigate encryption.\n\n**Tox**\nTox uses a custom implementation, as described below, which encrypts each message for each participant’s keys.[4]\n\n“Groupchats use the NaCl/libsodium cryptography library for all cryptography related operations. All group communication is end-to-end encrypted. Message confidentiality, integrity, and repudiability are guaranteed via authenticated encryption, and perfect forward secrecy is also provided.\n\nOne of the most important security improvements from the old groupchat implementation is the removal of a message-relay mechanism that uses a group-wide shared key. Instead, connections are 1-to-1 (a complete graph), meaning an outbound message is sent once per peer, and encrypted/decrypted using a key unique to each peer.”\n\nThis scheme provides perfect forward secrecy (PFS) and deniability, but at the expense of poor scaling, so we should consider this a non-option for the reasons described in the scaling section. In terms of scalability, this solution is similar to using the Signal protocol in pairwise operation.\n\n## TextSecure V2/Sender Keys (Signal, WhatsApp)\nThe “senders keys” method is used by Signal and WhatsApp to encrypt messages for a group (discussion can be found on the Signal blog). This scheme provides a higher level of scalability, PFS and deniability, however it fails under post compromise security (PCS). This means If sender keys are stolen or leaked, they can be used to impersonate or read all future group messages. To remedy this, a new sender key message can be broadcast and users can re-establish a secure group, but because these messages must be encrypted and sent to each user individually, this scales poorly. Additionally, users who leave the group force renegotiation of shared keys.\n\nThe “senders keys” method tends to work best in smaller groups of less than 50. Once the group grows sufficiently, the additional bandwidth overhead of adding new users, departing users, and ordering messages degrades in production applications like Signal.[5] It is also questionable if groups larger than 50–100 members actually require full PFS, because as the group size grows, fewer users verify the identity of added members out of band, and messages can be being leaked by inserting a new member or compromising existing ones.\n\nThe ‘senders keys’ scheme is the most easily accessible in the context of Loki Messenger, since it is based on the Signal application. It is also a well tested and implemented protocol with known security properties.\n\n## MLS With Tree-Based Diffie Hellman\nMessage Layer Security (MLS) is proposed as a new interoperable standard for encrypted messaging on the internet, similar to TLS — except MLS specifically focuses on secure group messaging. MLS aims to provide both PFS, Deniable authentication, and PCS inside a group environment while still maintaining a high level of scalability.\n\nThe idea behind MLS is to use a tree-based Diffie Hellman in a group context. Quoting from “On Ends-to-Ends Encryption: Asynchronous Group Messaging with Strong Security Guarantees,” [6]\n\nBy using the treeKEM method, MLS provides much better scalability (shown below) when creating groups and dealing with members who leave groups. It also provides PCS, which the ‘senders keys’ scheme does not. The full specification for MLS is still being discussed and iterated on by an IETF working group.[7] There are some reference implementations, but as of yet no working end to end encrypted application that has deployed MLS.\n\n![0_OTHkayVSvB2DoO6K.png](https://cdn.steemitimages.com/DQmYgG9qDvHKXaX7Kk6DbyzYRijfxAvh4UEfzdqdPzh3x9r/0_OTHkayVSvB2DoO6K.png)\n\nhttps://eprint.iacr.org/2017/666.pdf “our solution” here is in reference to Tree-based DH using Asynchronous ratchet trees\n\nMLS is a promising protocol, however since it is in the draft stages of development at the IETF, it may be unwise to begin work on implementation until the protocol stabilises. Additionally, MLS is still working through some open problems — namely that MLS requires messages to maintain strict ordering, which can be difficult to achieve when in large groups with many clients. MLS is also trying to address state corruption attacks that could deny service to members in the group, which could be performed by a malicious group member.\n\n## Conclusion\nWe’re still exploring the best way to go about group messaging in Loki Messenger, however it seems likely that our first group messaging scheme will involve a user hosted server that utilises the existing ‘senders keys’ encryption scheme to attain it’s security. We will continue to assess MLS as it becomes a more complete specification, with the hopes of eventually providing an open-source implementation in Loki Messenger. \nIf you have any thoughts or questions to add to this discussion, join us on the Discord.\n\n## References\n[1] “The TokTok Project — Protocol.” https://toktok.ltd/spec.html#group. Accessed 6 Mar. 2019.\n\n[2] “GitHub — loki-project/loki-storage-server: Storage server for Loki ….” https://github.com/loki-project/loki-storage-server. Accessed 6 Mar. 2019.\n\n[3] “Loki Name Service · Issue #342 · loki-project/loki · GitHub.” 22 Nov. 2018, https://github.com/loki-project/loki/issues/342. Accessed 27 Mar. 2019.\n\n[4] “The TokTok Project — Protocol.” https://toktok.ltd/spec.html. Accessed 8 Mar. 2019.\n\n[5] “After leaving group user is still able to read new messages · Issue ….” 16 Oct. 2017, https://github.com/signalapp/Signal-Android/issues/7103. Accessed 26 Mar. 2019.\n\n[6] “On Ends-to-Ends Encryption — Cryptology ePrint Archive.” https://eprint.iacr.org/2017/666.pdf. Accessed 12 Mar. 2019.\n\n[7] “Messaging Layer Security (mls) — IETF Datatracker.” 7 Nov. 2018, https://datatracker.ietf.org/wg/mls/about/. Accessed 26 Mar. 2019.\n\nOriginally published at [loki.network](https://loki.network/) on March 29, 2019.",
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      "body": "Hi! I am a robot. I just upvoted you! I found similar content that readers might be interested in:\nhttps://loki-project.github.io/loki-docs/ServiceNodes/InfiniteStakingPrimer/",
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      "body": "https://cdn-images-1.medium.com/max/1000/1*Kk1sC7bJozCnfpTkLhMD2g.png\n\n# **Outline For Existing Service Node Participants and Operators**\n\nInfinite Staking is an incremental upgrade on the existing staking process that is currently available on the Loki network (currently active in Hardfork 10: Bulletproofs, introduced in Hardfork 9: Service Nodes). With Infinite Staking, Service Nodes do not expire and funds remain locked until a contributor or operator explicitly requests the Service Node to unlock the funds.\n\nSince Infinite Staking is an incremental upgrade, most of the steps necessary to register and participate in a Service Node remain the same. A quick overview for the new staking process is summarised for quick grokking.\n\n# **Updated Staking Process and Commands**\n\n## **Operators**\n\nOperators will still use the following commands when setting up a Service Node. The commands are as follows:\n\n* `prepare_registration` in the daemon that is running in --service-node mode\n\n* `register_service_node` with the command returned by the daemon. Auto staking is no longer an option.\n\n## **Contributors**\n\nContributors will still use the following command when contributing to a Service Node:\n\n* `stake` to contribute to the node. Auto staking is no longer an option.\n\n## **Operators & Contributors (When Service Node Active)**\n\nTwo new commands have been added to stop your Service Node from staking, and both the contributor and operator can execute these commands:\n\n* **(Optional)** `print_locked_stakes` to preview all of the current wallet’s transactions that are locked in a Service Node or blacklisted on the network.\n\n* `request_stake_unlock` to request to unlock the stake in 15 days (10800 blocks).\n\n# **Unlocking Stakes & Deregistration**\n\nService Nodes will receive block rewards indefinitely until a stake is unlocked or the Service Node becomes deregistered. Unlocking is available via the `request_stake_unlock` in the command line wallet. Once the unlock is requested and the request is included in a block in the blockchain, the Service Node will then expire in 15 days (10800 blocks) and the funds will become unlocked after expiry.\n\nIn pooled nodes, any contributor that requests the stake to unlock will schedule the Service Node for expiration. All locked stakes in that Service Node will be unlocked in 15 days (10800 blocks). Once the unlock is requested, this process can not be undone or prolonged. Service Node participants will continue receiving rewards until expiration.\n\nUnder the new system, deregistrations can be issued at any point during the active lifecycle of the Service Node. This is inclusive of the time period during which the Service Node is scheduled for expiry. Getting deregistered removes your Service Node from the network and your stakes are placed into a list of blacklisted transactions. Blacklisted transactions are locked and unspendable for 30 days (21600 blocks) from the block in which the Service Node was deregistered.\n\nReceiving a deregistration after participants have already requested the stake to unlock overrides the 15 day (10800 blocks) unlock time, and resets the unlock time to 30 days (21600 blocks).\n\n# **Minimum Contribution Rules**\n\nInfinite Staking introduces new limitations on the number of transactions that can be contributed to a Service Node, changing the minimum contribution rules for participating in the Service Node.\n\nService Nodes accept at most 4 contributions, meaning the minimum contribution to a Service Node becomes:\n\nhttps://cdn-images-1.medium.com/max/1000/1*JRuMEP-WKezuqMOHKo3GeQ.png\n\nIn a pooled Service Node with reserved spots, the Minimum Contribution must be either the Reserved Amount or the Contribution determined by the above equation, whichever is larger.\n\nhttps://cdn-images-1.medium.com/max/1000/1*MABvhhCboua_4MOJMXqKCg.png\n\nA simple example: if the staking requirement is 24,000 Loki, then if\n\n* Operator contributes 50% of the requirement (12,000 Loki)\n\n* The next contributor must contribute at least (⅓ * 12,000) Loki i.e. 4000 Loki to become a participant.\n\n* If this contributor had reserved a spot for more than 4000 Loki, their Minimum Contribution would be that amount.\n\nThere are rules in the client software in place to stop users from irreversibly funding a Service Node into an invalid state.\n\n# **Staking Changes**\n\nUsers are no longer allowed to stake on behalf of another participant in the Service Node. All contributions for a participant must come from the same wallet address as the one specified in the Service Node.\n\n# **Developer API Changes**\n\n**get_service_nodes**\n\nUpdated/newly added fields:\n\n* `requested_unlock_height` – The height at which the stakes will unlock and the Service Node will expire.\n* `contributors`\n* `locked_contributions` – An array of each contribution from the contributor that is locked.\n* `key_image` – A string representation of the locked key image (stake).\n* `key_image_pub_key` – A string representation of the public key component of a key image.\n* `amount` – The amount of Loki locked in this contribution.\n* `get_service_node_blacklisted_key_images`\n\n**Retrieve a list of blacklisted transactions from deregistered Service Nodes on the network.**\n\n* `blacklist` – An array of each blacklisted transaction from deregistered Service Nodes\n* `key_image` – A string representation of the blacklisted key image (stake).\n* `unlock_height` – The height at which the stake can be spent again.\n\nOriginally published at [loki.network](https://loki.network/) on March 15, 2019.",
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      "body": "Hi! I am a robot. I just upvoted you! I found similar content that readers might be interested in:\nhttps://medium.com/@LokiNetwork/company-update-december-january-2018-2019-addd8240658f",
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      "body": "https://cdn-images-1.medium.com/max/1000/1*Kk1sC7bJozCnfpTkLhMD2g.png\n**Software Development Services**\n\nDuring the December — January period, we continued to operate with a high level of development capability and efficiency, successfully implementing the Festive Freya Hardfork. While some bugs were discovered after the release, they were minor in nature and were rapidly patched as soon as they were identified. We have improved the staking process for Service Nodes and implemented Bulletproofs, resulting in a reduction of the average transaction size by approximately 90%. Loki Messenger is taking shape while being integrated on the test Service Node swarm functionality. We have been completing milestones on time and are expecting the different Service Node based functions to come together by the end of Q1 or start of Q2. We have made some advancements on returning the Loki Web Wallet to an operating state, which we will aim to release publicly in the coming months. As expected, there were merges from Monero’s code which resulted in Loki core improvements as well as merges from Signal for Loki Messenger. The Gui and Mobile wallet have each received user improvements and have become much more stable in the latest release. For further information on the development of Loki during this period, please refer to the weekly dev updates or view our progress on the Loki Github repository.\n\n**Networking Infrastructure & Performance Testing Services.**\n\nWe have run and maintained critical network infrastructure during this period without any major downtime, other than the short upgrade periods. Testnet Nodes have been running continuously, although we have discovered a number of anomalies while running our tests which we plan to iron out before the next release. We have successfully run services on Lokinet alpha, and were happy to discover third parties integrating their own services on the platform as well. We have released some of the Loki testing tools, such as a dashboard to monitor the overall network and Service Nodes. Since enabling Cloudflare, we have not had any further issues with Loki websites being disrupted or going down.\n\n**Marketing Services**\n\nDuring the month of December, we ran an ‘advent calendar’ competition which delivered one of our highest community engagement to date for Loki, coinciding with the Festive Freya hard fork release. During the months of December — January we’ve seen sustained organic growth through most of our social media channels. Reddit has produced the highest increase in organic user interaction, thanks to our constant stream of updates and consistently high quality content. During the Festive Freya competition, the Loki website, Twitter engagement and Reddit received the highest user traffic out of all of the social media platforms we interact with. We have also begun planning for marketing strategies for the year ahead, which will coincide with the next major hard fork and major conferences. We have planned out a possible path to introduce Loki into more Asian markets later in the year.\n\n**Media Services**\n\nWe are now in the later stages of completing a new animation for Lokinet. We are pleased with the progress of the animation and are expecting it to be completed shortly. We overhauled the Loki.network website completely making it easier to use, and we have introduced new features. We have released two blog posts related to SNApps and a blog related the the new encryption laws recently brought out in Australia during this period. There was further publicity and pieces written and published regarding our position on the new bill. We also released content on Youtube related to Service Nodes in the form of a Q & A, and some edited versions of Jeff working on Lokinet. Simon and Kee partook in a number of podcasts and interviews related to Loki; these were well received. We continued to reward community members with personalised community awards.\n\n**Documentation Services**\n\nLoki Docs have been proactively updated to reflect changes and additions made to Loki services. Loki Docs have now become an essential reference tool for new and current users of all Loki related services. We documented development changes on Github, as well as published weekly development summaries and updates for public perusal. We assisted the LAG with document management and integration procedures. We have also completed multiple exchange application forms, some with over 100 questions related to Loki. In addition, we released a Chinese version of the Loki whitepaper.\n\n**PR Services**\n\nWe have continued to work closely with Wachmans to promote Loki on the global stage. We undertook a number of media opportunities to promote Loki in relation to the controversial Access Bill, recently released in Australia. Wachmans has arranged a speaker role for Loki at Token 2049 conference in Hong Kong during Asia Crypto Week, in March 2019. Loki’s co-founder and project lead, Simon Harman, will present at this conference. We anticipate that we will see more tangible results from the services provided by Wachmans over the next 3–6 months with the launch of our products.\n\n**Conference Attendance and Promotional Services**\n\nMembers of the team attended multiple conferences during the December — January period. Kee and Ryan attended Stanford Blockchain conference in San Francisco to promote Loki and conduct research at the Stanford Centre for Blockchain Research. Multiple members of the team presented a live Alpha demo at RMIT University, Melbourne showing off some of the features of Lokinet, Loki messenger and Snapps. We have booked and paid for a booth at Consensus, in May 2019. Following the conference, we will bring members from the public and key Loki developers from around the world together in New York for a Loki SNAppathon.\n\n**Research and Theoretical Development Services**\n\nWe have continued to stay on the front foot during this period, researching other projects such as Tor, Monero and Signal to be sure we are staying up to date with their development movements and continue to integrate some of the best features from each project into Loki. We have conducted research through Q & A sessions with the community to maintain a transparent and informative position on our development. We have continued to research and build Infinite Staking for Service Nodes to improve the usability for the community members who are running Service Nodes. We have increasingly noticed other projects with lower hashrates being hash attacked, so we conducted further research into Checkpointing and have published a proposal for the improvement on Github.\n\n**Data Analytics and Market Research Services**\n\nWe have collected and monitored data on engagement with Loki’s social media platforms and website since January 2018. In regards to our overall social media growth and presence, we have noticed a consistent increase of interactions and members across the the majority of our social media platforms. With noticeable spikes correlating to major marketing campaigns and developmental implementations. An improved Dashboard was released during this time, which accurately shows the strength of the network. We have begun researching our targeted audiences and possible market share and plan to release the findings of this research in the coming weeks.\n\n**Administration and Bookkeeping Services**\n\nWe completed documentation and negotiated on behalf of LAG to improve liquidity of Loki through exchanges, payment gateways such as Coinpayments and other third party trading gateways. We have safely conducted competitions and safely completed prize payments to puzzle winners from the Festive Freya Advent calendar. Due to the recent loss of Cryptopia, we have increased our efforts in regards to communications during this period with exchanges across the globe, providing them with relevant information. We have also worked with MasterNode websites to correctly share Loki relevant information. The Loki Improvement Proposal related to Checkpointing was also conducted during this period. We have assisted LAG in regards to bookkeeping, storing documentation, organising meetings and communications directly related to the LAG’s operational requirements.\n\nOriginally published at [loki.network](https://loki.network/) on March 5, 2019.",
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      "author": "cheetah",
      "body": "Hi! I am a robot. I just upvoted you! I found similar content that readers might be interested in:\nhttps://loki.network/wp-content/uploads/2018/08/LokiWhitepaperV3_1.pdf",
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      "body": "As Loki is the first Monero fork (and CryptoNote coin, by extension) to have an active implementation of Masternodes, we are staggering releases and adding features as we go. This is new territory and each change we make to the the Monero codebase must be extensively tested before release.\n\n \n\n**What Loki Service Nodes do in the short term?** (Right now)\n\nAs part of the 1.0.0 release, Loki Masternodes (called Service Nodes) will have minimum functionality; they will store a full copy of the blockchain, and every hour they will publish an uptime proof, which is essentially a ping to the network letting the network know that they are still live. Nodes that have not submitted an uptime proof in 2 hours will be deregistered by voting quorums. Voting quorums are randomly selected sets of 10 nodes which vote on the state of the network every block.\n\nAlthough the first implementation of Masternodes on a Cryptonote coin is a large move forward in the Masternode world, the major advantages that Service Nodes provide during this beginning stage will be greater privacy when transacting. However, Loki Service Nodes have larger plans ahead, and release 1.0.0 represents only the foundation.\n\n \n\n**In the Medium Term** (3-6 Months)\n\nIn the medium term we are working towards making Service Nodes useful to the end user. This includes a couple of essential features:\n\nEvery Service Node will now be a remote node that serves the blockchain to users.\nEvery Service Node can now run tests and collect data on other Service Node performance; they can assess blockchain storage, bandwidth statistics, and provide message storage for Loki Messenger.\nBased on these tests, Service Nodes can deregister any underperfoming node if the voting quorum reaches consensus.\nLokinet will be deployed on Service Nodes, along with the Loki Message server.\nAdding these features to Service Nodes allows us to deploy our first end-user Loki Service called Loki Messenger. Loki Messenger (based on the Signal protocol) allows users to communicate more privately than ever through the first market-based Sybil resistant mixnet network, Lokinet.\n\n \n\n**In the Long term** (6-12 Months)\n\nIn the long term Loki Service Nodes will need to have high capacity bandwidth connections to provide to the Loki network with routing data. Lokinet will become a fully fledged mixnet providing anonymous access to the internet, and will also have direct integration with browsers, providing an integrated solution for private messaging, internet access and finances .\n\n \n\n**Want to Know More?**\n\nOur [Whitepaper](https://loki.network/whitepaper) details the technicals behind Loki’s network architecture and Service Node functionality, and our Cryptoeconomics paper provides an in-depth analysis on the economics around our Service Nodes.",
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      "author": "loki-network",
      "body": "![1_Kk1sC7bJozCnfpTkLhMD2g.png](https://cdn.steemitimages.com/DQmSUBCSQ8LGLEEwLBGKgXL9vkjQvpLtz1NV8wSLXwotyyo/1_Kk1sC7bJozCnfpTkLhMD2g.png)\n\nHey Everyone,\n\nThe development pace in the Loki office has been consistent and quicker than expected, and I’m happy to announce that we will be launching Service Nodes well ahead of schedule. A huge thank you to our two main Service Node developers, [jcktm](https://github.com/jcktm/) and [Doy-lee](https://github.com/Doy-lee), who have been putting in long hours to get this out. This will mark the first time Proof of Service has been implemented on a CryptoNote coin and we’re really excited to have everyone onboard to test it out.\n\n**How will the rollout/update process work?**\n![1_r2ncvrAR0dbF2-tY-eF88Q.png](https://cdn.steemitimages.com/DQmNcpDfVjx3MzZc9niDEHhwpxig3P3bj64BC1TsJr2HtAP/1_r2ncvrAR0dbF2-tY-eF88Q.png)\nBeginning on 09/08/2018 (August 9th) the testnet will be restarted with Service Nodes enabled. The testnet will operate for two weeks in this state. During this period, we will make final changes to the Service Node software, fix bugs as they are reported to us, and add features which will be useful for the final release. Bugs found by community members in Service Node software will be rewarded with bounties at the discretion of the Loki team and depending on severity.\n\nOn 23/08/2018 (August 23rd) we anticipate the release of the final version of the Service node software, including any bug fixes/changes we found in the Service Node testnet period. This release marks a mandatory upgrade period between 23/08/2018 and 20/09/2018. In this period we will contact exchanges, pools, and miners. All clients will need to update their software. Testnet will continue operation with the new changes, however **on 20/09/2018 (September 20th) mainnet and stagenet will hard fork and Service Nodes will be released** in a production environment.\n\nService Nodes already set up on testnet will **NOT** rollover to mainnet, so when the mainnet forks everyone will have the same opportunity to begin operating a service node using real Loki.\n\n**What do Service Nodes do in this update?**\nAs part of the rollout process we need to slowly introduce Service Node functionality. In this upcoming fork, Service Nodes will only have the ability to register and receive rewards. There is no complex testing functionality yet enabled. In this fork Service Nodes will not route data other than propagating blockchain data to their peers. However to be rewarded, Service Nodes that are online automatically transmit pings to the network. If a ping is not submitted each hour a node is assumed to be offline and will be deregistered.\n\nMore complex functionality is being heavily developed as we speak and will be introduced to Service Nodes over the coming months. However, it is essential that we deploy the base functionality of Service Nodes before we can begin integrating more complex testing and begin routing packets on top of service nodes.\n\nRemaining features that will be introduced over the coming months:\n\nBlink (Instant Transactions)\nLokinet (Packet Routing & SNApps)\nLoki Messenger (Message Storage)\nEnforced Remote Nodes (Light Client Improvements)\n\n**How can I register a Service Node on testnet?**\nYou will need the alpha software from [here](https://github.com/loki-project/loki/releases), and instructions on how to use it are [here](https://github.com/jcktm/loki/blob/service-node-guide/service_node_guide.md), this also includes a guide on how pooled staking works. This guide assumes you know how the CLI and daemon work. If you don’t, a complete guide on staking is in the works, so sit tight!\n\nTo test Service Nodes, you will need:\n\n100 testnet Loki\nA VPS, or highly available home server\nThe Loki CLI wallet, and the Loki Daemon\nOn testnet, the staking requirement will be 100 Loki, so everyone can get in and test. We will distribute funds from the testnet foundation wallet, so just ping one of the admins in the Loki telegram or [discord](https://discord.gg/FkwRPSA) and we will send you some testnet Loki to stake. You can also mine testnet loki by running start_mining <address in lokid.\n\nWe’ve also shortened the staking duration to just 2 days in the testnet, so you should be able to test restaking over the next couple of weeks to familiarise yourself with the process.\n\nThis would also be a good time for anyone seeking to pool their staking requirement to test out how that functionality works. So jump on testnet and start testing.\n\n**How can I provide feedback or submit bugs?**\nFor general feedback and discussion about the software, you can go to the brand new [#service-node-testing discord channel](https://discord.gg/FkwRPSA).\n\nIf you spot bugs in the code or add features to it, you should submit an issue or pull request to [GitHub](https://github.com/loki-project/loki). The devs will review the bugand include any necessary fixes in the final release.\n\n**What are the requirements for setting up a Service Node on Mainnet?**\nWe have been testing various VPS providers across the course of the last few months and we will be making some recommendations based on positive experiences. In the beginning Service Node operators will have much more choice about where they set up their nodes due to the significantly lower stresses they face. When Loki Messenger and Lokinet are finished, the bandwidth requirements will become more onerous and low performance nodes will have to upgrade hardware and network connections or risk being kicked off the network by automated bandwidth testing systems. When a date for Lokinet is set, we will warn Service Node operators at least 30 days in advance so that they can upgrade their servers.\n\n**Where can I go for more information on Service Nodes?**\nWe are currently setting up a webpage to act as a central point for operators to stay updated with all of the latest information. This portal will be updated as we produce documentation on Service Nodes. We want to make setting up a Service Node as clear as possible, and provide in-depth explanations on how the process works, so operators don’t end up making expensive mistakes.\n\nWe are updating the channels in [discord](https://discord.gg/FkwRPSA) to include a dedicated Service Nodes category, so we can have more in-depth discussions about the software and provide support to those having difficulty.\n\nVery exciting times! Let’s get testing, LOKIGANG!\n\nOriginally published at [loki.network](https://loki.network/service-nodes-testnet-release-date-announced/).",
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      "body": "![1_pn8abNlN6YDT88uRLDekaw.jpeg](https://cdn.steemitimages.com/DQmeYYUdvXUA49dJtkNTLjYUaxNAdk4XL7uucudVxbUkCGX/1_pn8abNlN6YDT88uRLDekaw.jpeg)\nOver the last three months, there has been significant focus on Loki’s layer two, with numerous papers and articles revealing the true scope of Loki’s Service Node functionality with Loki now becoming a fully fledged mixnet. There has also been much talk about how Loki as a currency, or layer one transactional medium, will function in this framework. Initially we envisioned Loki would act as an access token to prevent Sybil attacks, however there are some downfalls of that system which we addressed in an article here. Given we have focused so much on Loki’s second layer, it’s time to give Loki’s first layer some explanation, and demonstrate why Loki is not only an advancement in layer two design, but also what makes it a worthwhile cryptocurrency.\n\nA Move Towards Scaling\nMonero and most other Cryptonote coins have dynamically scaling block sizes, meaning there is no hard limit to how many transactions can theoretically take place on the blockchain. However in practice, nodes must transmit data between each other, and as each block is accepted into the network and the block size grows, low performance nodes can struggle to keep up with the higher bandwidth requirements and suffer computational stress trying to verify all transactions. This can centralise the operation of full nodes to miners, who make up one of the only parties that have an incentive to operate full nodes.\n\nIf we can create a way to incentivise the operation of full nodes, we can avoid the aforementioned issues. This is one of the goals of Loki Service Nodes; to create a network of full nodes that are incentivised to hold and serve a full copy of the blockchain. These nodes must meet standards of service that are tested by a distributed method of flagging called Swarm Flagging. Because nodes are competing for a limited block reward and can be removed from the staking reward pool, they are always incentivised to serve copies of the blockchain to users and relay transactions.\n\nTheoretically, this means that Loki can scale to handle much larger blocks and thus, handle a higher transaction throughput. This is predicated on the fact that the full nodes operating on the Loki network offer higher bandwidth/storage and compute performance than nodes on the Bitcoin or Monero network.\n\nInstant Transactions with Blink\nIn a typical blockchain system, the confirmation time for any given transaction is the time it takes for a transaction to be included in a block. However, because of competing miners, withheld blocks, and Finney attacks, recipients usually require a number of additional blocks to be created on top of the block which holds a transaction before it is considered to be complete.[1] Depending on a multitude of factors specific to each blockchain, this process can take 10–60 minutes, which is inconvenient for merchants and customers who must wait for confirmations before they release goods or commence services.\n\nBecause of Loki’s Service Node architecture, near instant transactions are possible. Blink enables the same transactions that would occur on the Loki mainchain to be confirmed in seconds rather than minutes, assuring both the sender and the receiver of the validity of the transaction, and protecting the receiver against a double spend.\n\nBlink works in a similar fashion to DASH’s InstantSend.[2] However unlike DASH’s InstantSend, Loki maintains all of its privacy properties throughout the process. Any third party looking at a Blink transaction will have no idea of the amount, nor the address of the sender and receiver. This opens up a range of new use cases for Loki, where face-to-face payments become increasingly practical and online payments become quicker and easier for users.\n\nStable and Formally Defined Funding Model\nFunding models for cryptocurrencies are generally tricky, weak and informal, and donation only models can lead to the creation of special interest groups like blockstream, Bitcoin Unlimited and Bitcoin ABC. These groups typically act as for profit companies who drive an agenda that might not align with the community as a whole. The downside to most formally defined models is they act as a sort of tax, either through emissions or some kind of fee. This can be seen to take choice away from users as they are unable to allocate their funds to the projects they see as important.\n\nAttempting to solve some of the aforementioned issues, Monero maintains a forum funding system, which is fully funded by a donations model. Projects vetted by the the Monero core team are featured on the Seeking Funding page, and users are free to donate Monero to projects they feel are worthy. The Monero core team also has an official donations wallet which often contributes large amounts of Monero to projects seeking funding. The advantage of the donations model is that users have full autonomy over how they spend their funds and what specific projects they support. However, there are also disadvantages to this model: funding is never guaranteed for high quality projects, and a large number of the projects receive about 1/5th of their donations from their ‘General Donations’ fund for Monero itself. The ability for a community like Monero to continue to self-fund and provide core contributions may decrease over time, and that’s something we want to avoid with Loki.\n\nLoki’s long-term funding model is quite different from the donations model used by the cryptocurrencies mentioned above, and we think it will provide a significant advantage to consistent development, which will be in the interest of our users. Proposed in the whitepaper V3 is a revised governance block reward, which allocates 5% of each block reward to fund governance operations. Of this, 5% block reward 3.75% is controlled by the Loki Foundation, a registered Australian non-profit which is legally bound to spend the block reward as per its constitution.\n\n“facilitating the development of an open source, highly secure, decentralised data transmission network that allows individuals, business and government to freely transact and communicate without the threat of malicious third party interference”\nThe other 1.25% is controlled by the Service Nodes through the Loki funding system. The Loki funding system is an entirely non-custodial system of proposal funding, meaning the Loki Foundation cannot control how its funds are allocated. Because Service Nodes are not bound by Australian law or a constitution, this greatly expands the range of proposals that can be funded. To distribute funds to proposals, Service Nodes vote on proposals that occur on-chain, and funding is allocated every two months via special funding blocks which pay a portion of their block reward to proposal addresses. Because Service Nodes represent players with a high stake in the Loki system, they are incentivised to vote on proposals which will increase the value of their stake.\n\nRemote Node Availability\nDue to the design of all CryptoNote coins, the blockchain cannot be easily queried by connection to a full node. Instead of simple queries being made for the balances of public keys, full nodes must transmit full blocks to users, and the user has to scan every transaction in the block and identify whether they can calculate the private spend key for the destination stealth address. This results in significant stress being placed on every remote node operator with no reward, and Monero and other Cryptonote coins therefore rely on the altruism of community members to fund these operations, which can be problematic.\n\nIt is common for mobile users in Monero to cycle through 3 or 4 remote nodes before connecting to one that is reliable. Additionally, as any user can become a remote node that serves blocks to the community, there is the possibility that “popular” remote nodes will provide an altered history of the blockchain. Though this altered history cannot be used to directly steal a user’s funds, in combination with other malicious attacks, a remote node could potentially convince a user to send funds twice to someone who has already received the transaction.\n\nBy rewarding Service Nodes, Loki creates a large, decentralised network of nodes with a full copy of the blockchain. These nodes are incentivised to serve copies of the blockchain to users and relay transaction. If a user chooses to connect to these nodes at random, ‘popular’ nodes are no longer an issue. This also balances the load of remote syncing across the whole network instead of onto a select few nodes.\n\nLokinet, SNApps and Highly Integrated Payments\nWork is ongoing on Lokinet, which when fully launched will be a private, decentralised and Sybil resistant overlay network for the internet. You can read a detailed article about it here.\n\nAnyone can host services on Lokinet, which will be called SNApps (Service Node Applications). With SNApps, any web developer will be able to host websites that are completely anonymous; the website owner won’t know the IP address of their visitors, and and the visitors won’t know the IP address of the website they connect to. All content hosted inside Lokinet will be accessible through the Loki browser.\n\nThe Loki browser will have an inbuilt wallet. Users will be able to fund this wallet with Loki, and the browser will automatically hook into SNApps that display Loki addresses for payments. This will make it very easy for a user to operate a store, or take or make payments for goods and services while maintaining anonymity between both networking and transactional layers. Lokinet will also have exit functionality, so any website operator who serves a website on the wider internet will be able to implement these hooks for users of the Loki browser to easily manage Loki payments.\n\nIn Summary\nLoki’s value is derived not only from an inventive layer two, but also as a layer one transactional medium, or cryptocurrency. Although Loki is moving away from the use of $LOKI as simply an access token, there are still some significant advantages to $LOKI over other privacy based coins. Most of these advantages are a result of the widely distributed set of Sybil resistant nodes, called Service Nodes. Due to Loki’s high scalability, Loki can handle a higher transaction throughput and offer higher bandwidth/storage and compute performance than nodes on the Bitcoin or Monero network. Leveraging Service Nodes, Loki can be sent near instantly and privately using Blink bringing instant new use-cases. Loki’s unique funding model provides strong governance and avoids the pitfalls and potential risks that donation-only models pose. Due to Loki’s incentivised Service Nodes, remote syncing loads are balanced across the whole network and the issues caused by ‘popular’ nodes are avoided. Layer one, coupled with an impressive layer two provides a whole suite of services to assist Loki users transact and communicate with absolute freedom.\n\n[1] “Irreversible Transactions — Bitcoin Wiki.” 15 Mar. 2018, https://en.bitcoin.it/wiki/Irreversible_Transactions. Accessed 25 Apr. 2018.\n\n[2] “Whitepaper · dashpay/dash Wiki · GitHub.” https://github.com/dashpay/dash/wiki/Whitepaper. Accessed 27 Jul. 2018.\n\nOriginally published at loki.network.",
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      "author": "cheetah",
      "body": "Hi! I am a robot. I just upvoted you! I found similar content that readers might be interested in:\nhttps://coinlib.io/news/LOKI",
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      "body": "![1_Kk1sC7bJozCnfpTkLhMD2g.png](https://cdn.steemitimages.com/DQmSUBCSQ8LGLEEwLBGKgXL9vkjQvpLtz1NV8wSLXwotyyo/1_Kk1sC7bJozCnfpTkLhMD2g.png)\n\nThis article is intended as a basic overview as to the reasoning behind changing Loki’s emission curve. To this purpose we have largely simplified the factors and influences at play; for a more in depth understanding, please refer to our paper [Loki Cryptoeconomics: Alterations to the Staking Requirements and the Emission Curve](http://loki.network/proposal).\n\nDISCLAIMER\n\nThis article contains charts and figures which include examples of return of investments and prices for the Loki cryptographic coin. These prices are examples only and are not a prediction, forecast, or representation as to any actual likelihood of price movement of the Loki cryptographic coin. The payments shown in the examples below are general in nature and will only take effect if the planned hardfork occurs. Factors outside the control of Loki could impact what actual payments are made to Service Nodes. Those parties not operating a Service Node should not rely on these examples when deciding whether or not to participate in the Loki project. This article should be read together with the Loki whitepaper and full Loki Cryptoeconomic report.\n\nThe main goals in changing the Loki emission curve are to:\n\nMaintain Loki’s [Sybil](https://en.wikipedia.org/wiki/Sybil_attack) attack resistance, by\nEnsuring that enough Service Nodes are incentivised to run, by\nAiming to keep the return on investment (ROI) for running a Service Node at an acceptable level.\nThe current emission curve is problematic because an excess of Loki is being produced which could lead to a large number of Service Nodes in the early years. While this doesn’t sound like a bad thing, considering our commitment to a decentralised network and Sybil resistance, it will become an issue when the Service Node rewards are split between too many Service Nodes.\n\nWhile the price of Loki fluctuates with the cryptocurrency market, real world costs in running a Service Node exist, and the reward each Service Node receives for running must be greater than the real world cost of running. In other words, Service Node operators must be making an acceptable profit, or there won’t be incentive for them to run.\n\n\nChart 1\nChart 1 demonstrates that our current emission curve will result in many Service Nodes entering the network in the first few years, with the return on investment (ROI) quickly dropping below 0%. If too many Services Nodes run, the rewards are not worthwhile, and Services Nodes will leave resulting in a more centralised network.\n\n![1_9dLSBnv9WyfodRGKvX3lQQ.png](https://cdn.steemitimages.com/DQmYNLpiqKrV2YMDxNCRjSKqBJZNgZXzBYcb2zNiCUYadU6/1_9dLSBnv9WyfodRGKvX3lQQ.png)\n\nChart 2\nChart 2 depicts the effects of Loki’s proposed new emission curve, where there are less Service Nodes from the outset, but the return on investment (ROI) remains positive. This is better for the network in the long term because these Service Nodes will be continually incentivised to run (providing market-based Sybil resistance), while retaining a decentralised network.\n\n![ch2.png](https://cdn.steemitimages.com/DQmRrMJWuQzUoZGY76m2VFBu5YpmNoDNw8ipU7X3d9AqY34/ch2.png)\n\nFor further information regarding Loki Service Node game theory, and Loki Cryptoeconomics, please refer to the following reports:\n\n[Cryptoeconomics of the Loki Network](http://loki.network/cryptoeconomics)\n\n[Loki Cryptoeconomics](http://loki.network/proposal)",
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