Could a Proof of Burn function be implemented into Bitcoin Core to help prove loss of private keys?

Is there a list of self reported BTC addresses with lost private keys? Of course such a list would never be conclusive as we would have to trust the people who report that the keys were lost.

Could this trust issue be eliminated going forward by creating a Bitcoin proof of burn function (forcing BTC to be sent to a random address where it is extremely unlikely nobody holds the private key).

Such a function could not include the ability for the user to send BTC to an address of their choosing. It would need to be separate from the private key system already in place. It can also not be retroactive.

Assuming that the Private Key and "Proof of Burn Key" are stored separately, the purpose of this idea would be to allow:

Those who have lost their private key to prove their loss of ability to find it (this could have an impact on insurance, tax, inheritance claims or more)
You could use a multi-sig Proof of Burn system to help minority claimants (of blockchain businesses, heirs to a bitcoin estate, etc) the ability to call the bluff of a rogue partner or other beneficiary from making a "lost key" claim.

opensourceprivacy

Posted 2016-05-21T10:06:05.540

Reputation: 424

1Question makes no sense whatsoever. Proof of Burn is sending Bitcoins to an address that provably noone has the private key to. It has nothing to do with losing ones private key. Also the "accepted" answer doesn't answer anything, nor makes things any more clear. – Jannes – 2016-06-09T18:13:23.417

1This is speculation on how UTXO's could be spent by a mechanism other than fulfilling their encumbrance script. This is a fundamentally flawed concept, and it's just going to confuse newcomers looking for legitimate answers to their questions. – Jestin – 2016-06-09T19:59:17.723

1You could use a multi-sig Proof of Burn system to help minority claimants What would stop one of these minority claimants from extorting money from the owners of the Bitcoins? The core problem with this idea is that you must keep the Proof of Burn key just as secure as the original spending key. – Nick ODell – 2016-06-12T03:27:04.467

Answers

Interesting idea and theoretically possible but I think the implementation would be complex and potentially dangerous.

You are essentially asking to combine a private key to allow the spending of the coins with a mandatory RNG. If they can be separated (or the RNG compromised) the holder of the Proof of Burn key can send the Bitcoin balance to an address of their choosing.

John Adamson

Posted 2016-05-21T10:06:05.540

Reputation: 454

2This doesn't answer the question, whatever the question was, nor makes any sense. The private key is lost, but this is somehow a mechanism to retrieve the coins to an address of their choosing anyway? How does that not allow stealing the coins in the first place? And what's the difference with a simple multisig? – Jannes – 2016-06-09T18:16:55.443

There's already a way to burn bitcoins. You simply assign the bitcoins to an OP_RETURN. No need for the complex machinery.

Jimmy Song

Posted 2016-05-21T10:06:05.540

Reputation: 7 067

The suggestion seemed to focus on the ability to burn to without having possession of the private key – studycrypto – 2016-05-21T19:31:30.903