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# System prepended metadata

title: Sponsored accounts

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# Sponsored accounts

## Problem we want to solve
The requirement to buy and hold tokens is a hurdle for businesses to use public blockchains. Services like [Proofi](https://proofi.com) allow businesses to anchor through a third party, which takes care of the fees. Unfortunately this doesn't fit the narrative of a decentralized service where parties are participating through their own node.

Another option is through smart contracts where a provider buys and holds tokens on a smart account. The client holds provider holds the private key for anchor transactions, while the provider holds the private key to transfer tokens. This is similar to a broker service, which makes it difficult to sell.

Since this is such a prominent issue which nearly every public blockchain faces, we want to make a solution for this a core feature of LTO Network, something this isn't simply copied by (Ethereum, ed) smart contracts.

The message should be clear; **tx fees can be paid in LTO or in fiat**.

## Proposed solution
Waves network has [sponsored transactions](https://docs.wavesplatform.com/en/waves-client/assets-management/sponsored-transaction.html), allowing a sponsor to pay transaction feeds for anyone paying transaction fees in an asset token. We would like a similar feature, but not for using assets as fee.

The sponsor should issue a `SponsorTransaction`. After this transaction is confirmed, the transaction fee for any transaction issued by the sponsored account is automatically deducted by from the balance of the sponsoring account.

Sponsor also can create a `SponsorCancelTransactions` to cancel sponsorship. This should also be in effect immediately.

The sponsoring account can sponsor many other accounts.

## Benefits
With this feature it would be simple for anyone to offer a service where you pay LTO tx fees in euros, dollars, pounds, etc. We'd expect both integrators and bigger community nodes to offer this service.

In the future, the fees sponsored could count towards the ratio in PoI, keeping community nodes relevant. This is a big worry of parties running such a node today.

## Technical
The data structure for `SponsorTransaction` and `SponsorCancelTransaction` can be similar to [`LeaseTransaction`](https://docs.ltonetwork.com/public-node/protocol/data_structures#lease-transaction) and [`LeaseCancelTransaction`](https://docs.ltonetwork.com/public-node/protocol/data_structures#lease-cancel-transaction).

## Open questions
* Should we provide any measure to prevent abuse, like allowing the sponsor to set the (maximum) height of tx fees? Possibly this would be per tx type, allowing sponsoring some txs and not other. Or it this a risk the sponsor needs to take. In any case, the sponsor should limit the amount of LTO in the sponsoring account.
