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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

#311

Post by hossbeast »

mortdeus wrote: post #238
tehsauce wrote: post #110

Earlier quoted context omitted.

The spooky thing that this made me realize, is that if anyone did find a vulnerability in bitcoin (or any cryptocurrency) is that they would have a greater incentive to only slowly leech off the system, because they will be able to siphon out much more over time than if everyone panics over security. The weapon is no good unless it's secret.

What about state level actors, say the NSA, that consider bitcoin supplanting the US dollar as the standard medium of international currency exchange a huge threat to the world economy? (or at least their ability to control it) I think people need to be concerned that Governments, at any point of time, with their incomprehensibly huge computation power, can use it to crush bitcoin. Not only that but they can pass law…

How is the government going to forcibly size a wallet? Are you suggesting they can break the crypto, or that they will compel people to divulge their keys?

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

#312

Post by Jommi »

XR0CSWV3h3kZWg wrote: post #278
Jommi wrote: post #263

Earlier quoted context omitted.

You're only describing how it works with Bitcoin and other coins that are forked (git-forked) from it. Some blockchains require a higher amount of consensus to fork (blockchain fork).

Could you point to a PoW based cryptocurrency that isn't vulnerable to a 51% attack?

you're right, I was mixing up some concepts in my mind, sorry!

For others who might be confused, here is a good resource:

https://bitcoin.stackexchange.com/questions/26999/supermajor...

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

#313

Post by Jommi »

hisabness wrote: post #297
cesarb wrote: post #175

Earlier quoted context omitted.

Not only that, but also an attacker can wait until the money is "safe" outside the exchange before revealing the attack. If the attacker really has more than half of the hash rate, there's no time limit; the malicious chain will always be longer than the innocent one.

It’s also odd that the exchange would step into mediate. The miner is effectively playing by the rules i.e. if you have 51% you can do what you want.

It's only odd if you look at the community part of a decentralized coin as only the miners. You're missing the other critical parts which are its users and the exchanges.

A cryptocoin is worthless to miners if it cannot be exchanged, and it's worthless to exchanges if no one wants to trade it.

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

#314

Post by AndrewBissell »

physguy1123 wrote: post #252
pgwhalen wrote: post #206

Earlier quoted context omitted.

An interesting thought, but in practice, trading derivatives affects the value of the underlying pretty strongly. Whoever is selling you those puts is selling bitcoin (or futures) to hedge, which would drive the price down as you try to put on your position.

With options, buying deep OTM puts won't result in an immediate impact on the underlying market because they have such low delta and market makers aren't going to move a lot of spot to hedge it.

The problem is that if you successfully rook put sellers in this way for some ungodly amount of money, they will never be able to pay out on your claim. Kinda like when all the big Wall Street Banks were caught out because AIG was threatening to go bankrupt and default on their CDS.

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

#315

Post by grigjd3 »

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?

Trolling, because the internetz.

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

#316

Post by TeMPOraL »

dragonwriter wrote: post #212
h1d wrote: post #196

Earlier quoted context omitted.

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.”

Concern over the impact Bitcoin has on global energy use?

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

#317

Post by Jommi »

Ygg2 wrote: post #309
Jommi wrote: post #286

Earlier quoted context omitted.

yes?

What is the value of currency you can legally print on any printer? Zero. Edit: any crypto-currency you can exploit gives you option to print yourself money.

You're over reducing things to the point where they don't make sense anymore lol

First of all, the value of a currency that could be printer on any printer might not actually be even 0.

Secondly, cryptocurrencies do not operate in vacuum. Its not as simple as "printing yourself money".

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

#318

Post by brownbat »

jjeaff wrote: post #266
robertAngst wrote: post #255

Earlier quoted context omitted.

speak for yourself, only thing I cant pay is my mortgage. I have a shift card, bought tacobell with bitcoin.

That's not buying anything with Bitcoin. You are converting your Bitcoin to USD and then purchasing using the traditional, centrally controlled financial system. And that's not even considering the transactions fees it costs to get the Bitcoin to your account. Then there are the transaction fees for using the card, which coinbase says is free "for now".

That's like saying you can't buy anything with a VISA.

Sure, transactions are intermediated through some consensus denomination for exchange. So?

He still lost bitcoin and gained tacos. Just as someone else might lose a portion of a credit balance and gain tacos. You get just as full either way.

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

#319

Post by TeMPOraL »

hndamien wrote: post #209
jacquesc wrote: post #17

Earlier quoted context omitted.

So it's not a complete waste of natural resources because it helps secure "the chain"?

You know all that sunlight that hits the Earth that we don't convert into energy. Wasted natural resource. Loads of it.

No, it isn't. It's what lets you, and everything else, live, instead of freezing to death.

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

#320

Post by hudon »

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…

There is another--less talked about--way to double-spend: developers can cause forks and double-spend during the confusion.

In 2013, the network forked unexpectedly [0] and the Bitcoin network had 2 chains for about 4 hours. During those 4 hours, it is entirely possible that people sent BTC to exchanges they knew were going to be on the chain that ended up being orphaned.

A conniving team of centralized developers can take this a step further and discover or intentionally plant a consensus bug that causes such a fork and because developers ultimately tell everyone which chain contains the "fix" (in 2013, they commanded that the minority chain was the right one), the developers know which chain will be orphaned and thus which exchange they can exploit.

[0] https://freedom-to-tinker.com/2015/07/28/analyzing-the-2013-...

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