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Bitcoin Gold Hit by Double Spend Attack, Exchanges Lose Millions

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Re: Bitcoin Gold Hit by Double Spend Attack, Exchanges Lose Millions

#211

Post by biztos »

bo1024 wrote: post #145
jhpriestley wrote: post #83

When Bitcoin was running up to $20,000, I tried to analyze the system and come to a personal conclusion about its equilibrium value, because I didn't want to miss out if it really was the currency of the future. I ended up not investing, because of the possibility of a double-spend attack. I think that cryptocurrency enthusiasts are seriously underestimating the importance of double-spending attacks to the economics…

Those are some really great and interesting points. However, I think there is a resource you didn't mention that combats such attacks: time. If I'm a vendor, e.g. I pay cash for bitcoin, then I can tune the amount of time the transaction is held in limbo or escrow based on the vulnerability of the network. For instance, I can decide not to finalize the transaction until I see a chain with 12 new blocks added after th…

I'm a bit ignorant about cryptocurrency, but doesn't "I pay cash for bitcoin" sort of prove the parent's point that it's not "the currency of the future?"

Re: Bitcoin Gold Hit by Double Spend Attack, Exchanges Lose Millions

#212

Post by dragonwriter »

h1d wrote: post #196
dragonwriter wrote: post #115

Earlier quoted context omitted.

Assuming you want to make money directly, sure. If you want to harm a community in which the currency is widely used, the incentives are different.

What kind of incentive does the attacker have to just harm a community of a distributed system?

Association with or interest in a different (crypto or not) currency, leading to wanting to shake faith in the target currency.

Hostility toward a community in which the target currency is particularly popular.

“Some men just want to watch the world burn.”

Re: Bitcoin Gold Hit by Double Spend Attack, Exchanges Lose Millions

#213

Post by bdonlan »

vntok wrote: post #140
oh_sigh wrote: post #130

Earlier quoted context omitted.

Even finding a single double spend attack that only double-spends 1 satoshi would be enough to destroy bitcoin.

No it would not. Finding a BTC double spend attack vector would be like finding a 0-day: good and maybe even profitable up until fixed, which would take hours, days at most. Have 0-days destroyed Microsoft, Android, Firefox, Electron or Chrome?

Don't underestimate how long it takes to deploy a fix to such a vulnerability. Any change in consensus (which this would be) is a hard fork, and deploying it without carefully coordinating months in advance is certain to cause chaos.

Re: Bitcoin Gold Hit by Double Spend Attack, Exchanges Lose Millions

#214

Post by marcosdumay »

gamblor956 wrote: post #57
drb91 wrote: post #36

Earlier quoted context omitted.

There's a hidden cost of trust there, though, which vanishes with bitcoin (or at least reduces its cost). Maybe the value of bitcoin is more apparent from the perspective of venezuela at the moment, where the risk involved with traditional banks, currency, and security is more apparent. I am emphatically not taking a stance on which I prefer here, I might add, just pointing out that there are more variables here than…

Bitcoin and other cryptocurrencies require even more trust than normal currency. With a normal currency transaction, you need only trust at most 2 other entities entities: your counterpart to the transaction and the government issuing the currency. With a blockchain, you still need to trust the counterparty, but now you also need to trust that the coders have properly designed and programmed the system, and that the…

And you need to trust that your government won't take the currency away. There is no escaping from this one.

Re: Bitcoin Gold Hit by Double Spend Attack, Exchanges Lose Millions

#215

Post by garmaine »

rjkennedy98 wrote: post #185
jhpriestley wrote: post #83

When Bitcoin was running up to $20,000, I tried to analyze the system and come to a personal conclusion about its equilibrium value, because I didn't want to miss out if it really was the currency of the future. I ended up not investing, because of the possibility of a double-spend attack. I think that cryptocurrency enthusiasts are seriously underestimating the importance of double-spending attacks to the economics…

The numbers I've seen quoted for a double spend attach on Bitcoin Cash (assuming guaranteed block space) are that it would cost about 50K to double spend on a 0-conf transaction. So really, you can confidently accept 0-conf for <1K reasonably. More that that you can accept 1-conf or more which can take a minute or two. BTC rejects 0-conf transactions, but they are already in use around the world and are successful as…

It costs nothing to double-spend a 0-conf transaction.

Re: Bitcoin Gold Hit by Double Spend Attack, Exchanges Lose Millions

#216

Post by apo »

Oddly enough, one of the selling points of Bitcoin Gold (a hard fork of Bitcoin) was its use of Equihash instead of SHA-256. The idea was that a memory-hard proof-of-work function would inoculate Bitcoin Gold from miner centralization.

The problem with mining centralization is that sufficiently powerful miners can attack the network by rewriting blocks. This opens the door to double spending.

This was exactly the attack the article described.

It appears that Bitcoin Gold's decision to use Equihash led to this mess. The algorithm is used by several other coins. Hardware optimized for this algorithm can therefore be used with equal ease to mine on a network or attack it.

Bitcoin Cash may be headed for a similar fate. It retains SHA-256, but is a minority chain in terms of hash power. A powerful Bitcoin miner deciding to perform double spends on Bitcoin Cash would have everything needed to do repeat the Bitcoin Gold attack.

BTW, a similar attack recently occured on Verge:

https://blog.theabacus.io/the-verge-hack-explained-7942f63a3...

It's possible that any altcoin that becomes sufficiently valuable will suffer similar attacks to the ones that have now taken place on Verge and Bitcoin Gold.

Re: Bitcoin Gold Hit by Double Spend Attack, Exchanges Lose Millions

#217

Post by hndamien »

Arbalest wrote: post #164
rpearl wrote: post #149

Earlier quoted context omitted.

it is a waste. Bitcoin is an unqualified environmental catastrophe that is literally erasing any progress we've made to combat climate change. Burning away the future, turning useful energy purely and directly into waste and profit by shouting numbers into the void, not even leaving any artifact of value in its wake. There's not anything wrong with having a central monetary authority. There's not anything wrong with…

It could be argued that the trust could still be misplaced, but the idea that we can't trust governments for currency is barking up the wrong tree. The fundamental problems of inequality don't stem from Treasury, but rather from the game theory concept of the https://en.wikipedia.org/wiki/Gambler%27s_ruin making barriers to entry for new players always higher than the incumbents. You can take this all the way down to…

The same people arguing for trusting the Government for currency (the people that say "wasting electricity") are the same people that are also trusting the Government to solve the climate problem. They have obviously failed at the latter - no price on carbon, which ironically would resolve their complaint about the former since "wasting electricity" is code for "contributing to climate change" which is . not priced into the energy production economics the Bitcoin miners choose.

Re: Bitcoin Gold Hit by Double Spend Attack, Exchanges Lose Millions

#218

Post by jhpriestley »

split_tender wrote: post #199
jhpriestley wrote: post #83

When Bitcoin was running up to $20,000, I tried to analyze the system and come to a personal conclusion about its equilibrium value, because I didn't want to miss out if it really was the currency of the future. I ended up not investing, because of the possibility of a double-spend attack. I think that cryptocurrency enthusiasts are seriously underestimating the importance of double-spending attacks to the economics…

What do you mean, “underbidding”, e.g. “underbidding attack”? I don’t understand this term in the context of your hypotheses which assumes a perfectly efficient market for hashpower

Suppose that it takes $50 of energy to find a hash at current difficulty. Transaction fees are at $50 (in BTC). I can offer miners $51 for their hash power, but they might be suspicious. So the other thing I can do is confirm transactions for $49 in fees, which I'm calling underbidding. This will drive miners out of the market.

Re: Bitcoin Gold Hit by Double Spend Attack, Exchanges Lose Millions

#219

Post by rspeer »

DINKDINK wrote: post #203
jhpriestley wrote: post #83

When Bitcoin was running up to $20,000, I tried to analyze the system and come to a personal conclusion about its equilibrium value, because I didn't want to miss out if it really was the currency of the future. I ended up not investing, because of the possibility of a double-spend attack. I think that cryptocurrency enthusiasts are seriously underestimating the importance of double-spending attacks to the economics…

This attacked occurred on BTG a clone of Bitcoin, appropriating the name “Bitcoin” Gold. It has nothing to do with Bitcoin.

REG: Right. You're in. Listen. The only people we hate more than the Romans are the fucking Judean People's Front.

P.F.J.: Yeah...

JUDITH: Splitters.

P.F.J.: Splitters...

FRANCIS: And the Judean Popular People's Front.

P.F.J.: Yeah. Oh, yeah. Splitters. Splitters...

LORETTA: And the People's Front of Judea.

P.F.J.: Yeah. Splitters. Splitters...

REG: What?

LORETTA: The People's Front of Judea. Splitters.

REG: We're the People's Front of Judea!

LORETTA: Oh. I thought we were the Popular Front.

REG: People's Front! C-huh.

FRANCIS: Whatever happened to the Popular Front, Reg?

REG: He's over there.

P.F.J.: Splitter!

Re: Bitcoin Gold Hit by Double Spend Attack, Exchanges Lose Millions

#220

Post by hndamien »

spookthesunset wrote: post #156
always_good wrote: post #150

Earlier quoted context omitted.

Pretty weak line of reasoning. How much energy do you and everyone else waste doing things that don't add value to my life or society? Using your own comparison, why is it a big deal if little Jimmy can't afford a graphics card to play some Counter-Strike? Is gaming a better use for energy? Seems weird to pick on cryptocurrencies if you actually believe your premise, which I don't think you do.

> Pretty weak line of reasoning. Hardly. What, exactly, does bitcoin add to our world? Near as I can tell it's only use case is Making Money Fast (for the folks at the top of the pyramid, anyway) and scamming the bejesus out of all the rubes who fall for the con. > How much energy do you and everyone else waste doing things that don't add value to my life or society? Bitcoin is estimated to consume more than 0.5% of…

Funny you are arguing about the lack of value of security in a thread of a coin that just had its security broken.
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