aitbc/docs/reference/threat-modeling.md

AITBC Threat Modeling: Privacy Features

Overview

This document provides a comprehensive threat model for AITBC's privacy-preserving features, focusing on zero-knowledge receipt attestation and confidential transactions. The analysis uses the STRIDE methodology to systematically identify threats and their mitigations.

Document Version

• Version: 1.0
• Date: December 2024
• Status: Published - Shared with Ecosystem Partners

Scope

In-Scope Components

1. ZK Receipt Attestation System

   • Groth16 circuit implementation
   • Proof generation service
   • Verification contract
   • Trusted setup ceremony

2. Confidential Transaction System

   • Hybrid encryption (AES-256-GCM + X25519)
   • HSM-backed key management
   • Access control system
   • Audit logging infrastructure

Out-of-Scope Components

• Core blockchain consensus
• Basic transaction processing
• Non-confidential marketplace operations
• Network layer security

Threat Actors

Actor	Motivation	Capability	Impact
Malicious Miner	Financial gain, sabotage	Access to mining software, limited compute	High
Compromised Coordinator	Data theft, market manipulation	System access, private keys	Critical
External Attacker	Financial theft, privacy breach	Public network, potential exploits	High
Regulator	Compliance investigation	Legal authority, subpoenas	Medium
Insider Threat	Data exfiltration	Internal access, knowledge	High
Quantum Computer	Break cryptography	Future quantum capability	Future

STRIDE Analysis

1. Spoofing

ZK Receipt Attestation

Threat	Description	Likelihood	Impact	Mitigations
Proof Forgery	Attacker creates fake ZK proofs	Medium	High	✅ Groth16 soundness property ✅ Verification on-chain ⚠️ Trusted setup security
Identity Spoofing	Miner impersonates another	Low	Medium	✅ Miner registration with KYC ✅ Cryptographic signatures
Coordinator Impersonation	Fake coordinator services	Low	High	✅ TLS certificates ⚠️ DNSSEC recommended

Confidential Transactions

Threat	Description	Likelihood	Impact	Mitigations
Key Spoofing	Fake public keys for participants	Medium	High	✅ HSM-protected keys ✅ Certificate validation
Authorization Forgery	Fake audit authorization	Low	High	✅ Signed tokens ✅ Short expiration times

2. Tampering

ZK Receipt Attestation

Threat	Description	Likelihood	Impact	Mitigations
Circuit Modification	Malicious changes to circom circuit	Low	Critical	✅ Open-source circuits ✅ Circuit hash verification
Proof Manipulation	Altering proofs during transmission	Medium	High	✅ End-to-end encryption ✅ On-chain verification
Setup Parameter Poisoning	Compromise trusted setup	Low	Critical	⚠️ Multi-party ceremony needed ⚠️ Secure destruction of toxic waste

Confidential Transactions

Threat	Description	Likelihood	Impact	Mitigations
Data Tampering	Modify encrypted transaction data	Medium	High	✅ AES-GCM authenticity ✅ Immutable audit logs
Key Substitution	Swap public keys in transit	Low	High	✅ Certificate pinning ✅ HSM key validation
Access Control Bypass	Override authorization checks	Low	High	✅ Role-based access control ✅ Audit logging of all changes

3. Repudiation

ZK Receipt Attestation

Threat	Description	Likelihood	Impact	Mitigations
Denial of Proof Generation	Miner denies creating proof	Low	Medium	✅ On-chain proof records ✅ Signed proof metadata
Receipt Denial	Party denies transaction occurred	Medium	Medium	✅ Immutable blockchain ledger ✅ Cryptographic receipts

Confidential Transactions

Threat	Description	Likelihood	Impact	Mitigations
Access Denial	User denies accessing data	Low	Medium	✅ Comprehensive audit logs ✅ Non-repudiation signatures
Key Generation Denial	Deny creating encryption keys	Low	Medium	✅ HSM audit trails ✅ Key rotation logs

4. Information Disclosure

ZK Receipt Attestation

Threat	Description	Likelihood	Impact	Mitigations
Witness Extraction	Extract private inputs from proof	Low	Critical	✅ Zero-knowledge property ✅ No knowledge of witness
Setup Parameter Leak	Expose toxic waste from trusted setup	Low	Critical	⚠️ Secure multi-party setup ⚠️ Parameter destruction
Side-Channel Attacks	Timing/power analysis	Low	Medium	✅ Constant-time implementations ⚠️ Needs hardware security review

Confidential Transactions

Threat	Description	Likelihood	Impact	Mitigations
Private Key Extraction	Steal keys from HSM	Low	Critical	✅ HSM security controls ✅ Hardware tamper resistance
Decryption Key Leak	Expose DEKs	Medium	High	✅ Per-transaction DEKs ✅ Encrypted key storage
Metadata Analysis	Infer data from access patterns	Medium	Medium	✅ Access logging ⚠️ Differential privacy needed

5. Denial of Service

ZK Receipt Attestation

Threat	Description	Likelihood	Impact	Mitigations
Proof Generation DoS	Overwhelm proof service	High	Medium	✅ Rate limiting ✅ Queue management ⚠️ Need monitoring
Verification Spam	Flood verification contract	High	High	✅ Gas costs limit spam ⚠️ Need circuit optimization

Confidential Transactions

Threat	Description	Likelihood	Impact	Mitigations
Key Exhaustion	Deplete HSM key slots	Medium	Medium	✅ Key rotation ✅ Resource monitoring
Database Overload	Saturate with encrypted data	High	Medium	✅ Connection pooling ✅ Query optimization
Audit Log Flooding	Fill audit storage	Medium	Medium	✅ Log rotation ✅ Storage monitoring

6. Elevation of Privilege

ZK Receipt Attestation

Threat	Description	Likelihood	Impact	Mitigations
Setup Privilege	Gain trusted setup access	Low	Critical	⚠️ Multi-party ceremony ⚠️ Independent audits
Coordinator Compromise	Full system control	Medium	Critical	✅ Multi-sig controls ✅ Regular security audits

Confidential Transactions

Threat	Description	Likelihood	Impact	Mitigations
HSM Takeover	Gain HSM admin access	Low	Critical	✅ HSM access controls ✅ Dual authorization
Access Control Escalation	Bypass role restrictions	Medium	High	✅ Principle of least privilege ✅ Regular access reviews

Risk Matrix

Threat	Likelihood	Impact	Risk Level	Priority
Trusted Setup Compromise	Low	Critical	HIGH	1
HSM Compromise	Low	Critical	HIGH	1
Proof Forgery	Medium	High	HIGH	2
Private Key Extraction	Low	Critical	HIGH	2
Information Disclosure	Medium	High	MEDIUM	3
DoS Attacks	High	Medium	MEDIUM	3
Side-Channel Attacks	Low	Medium	LOW	4
Repudiation	Low	Medium	LOW	4

Implemented Mitigations

ZK Receipt Attestation

• ✅ Groth16 soundness and zero-knowledge properties
• ✅ On-chain verification prevents tampering
• ✅ Open-source circuit code for transparency
• ✅ Rate limiting on proof generation
• ✅ Comprehensive audit logging

Confidential Transactions

• ✅ AES-256-GCM provides confidentiality and authenticity
• ✅ HSM-backed key management prevents key extraction
• ✅ Role-based access control with time restrictions
• ✅ Per-transaction DEKs for forward secrecy
• ✅ Immutable audit trails with chain of hashes
• ✅ Multi-factor authentication for sensitive operations

Recommended Future Improvements

Short Term (1-3 months)

1. Trusted Setup Ceremony

   • Implement multi-party computation (MPC) setup
   • Engage independent auditors
   • Publicly document process

2. Enhanced Monitoring

   • Real-time threat detection
   • Anomaly detection for access patterns
   • Automated alerting for security events

3. Security Testing

   • Penetration testing by third party
   • Side-channel resistance evaluation
   • Fuzzing of circuit implementations

Medium Term (3-6 months)

1. Advanced Privacy

   • Differential privacy for metadata
   • Secure multi-party computation
   • Homomorphic encryption support

2. Quantum Resistance

   • Evaluate post-quantum schemes
   • Migration planning for quantum threats
   • Hybrid cryptography implementations

3. Compliance Automation

   • Automated compliance reporting
   • Privacy impact assessments
   • Regulatory audit tools

Long Term (6-12 months)

1. Formal Verification

   • Formal proofs of circuit correctness
   • Verified smart contract deployments
   • Mathematical security proofs

2. Decentralized Trust

   • Distributed key generation
   • Threshold cryptography
   • Community governance of security

Security Controls Summary

Preventive Controls

• Cryptographic guarantees (ZK proofs, encryption)
• Access control mechanisms
• Secure key management
• Network security (TLS, certificates)

Detective Controls

• Comprehensive audit logging
• Real-time monitoring
• Anomaly detection
• Security incident response

Corrective Controls

• Key rotation procedures
• Incident response playbooks
• Backup and recovery
• System patching processes

Compensating Controls

• Insurance for cryptographic risks
• Legal protections
• Community oversight
• Bug bounty programs

Compliance Mapping

Regulation	Requirement	Implementation
GDPR	Right to encryption	✅ Opt-in confidential transactions
GDPR	Data minimization	✅ Selective disclosure
SEC 17a-4	Audit trail	✅ Immutable logs
MiFID II	Transaction reporting	✅ ZK proof verification
PCI DSS	Key management	✅ HSM-backed keys

Incident Response

Security Event Classification

1. Critical - HSM compromise, trusted setup breach
2. High - Large-scale data breach, proof forgery
3. Medium - Single key compromise, access violation
4. Low - Failed authentication, minor DoS

Response Procedures

1. Immediate containment
2. Evidence preservation
3. Stakeholder notification
4. Root cause analysis
5. Remediation actions
6. Post-incident review

Review Schedule

• Monthly: Security monitoring review
• Quarterly: Threat model update
• Semi-annually: Penetration testing
• Annually: Full security audit

Contact Information

• Security Team: security@aitbc.io
• Bug Reports: security-bugs@aitbc.io
• Security Researchers: research@aitbc.io

Acknowledgments

This threat model was developed with input from:

• AITBC Security Team
• External Security Consultants
• Community Security Researchers
• Cryptography Experts

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This document is living and will be updated as new threats emerge and mitigations are implemented.