Subject: Re: [bitcoindev] [FULL DISCLOSURE]: Replacement Cycling Attacks on Attacks on Bitcoin Miners Block Templates

From: "David A. Harding" <[email-masked]>
Date: Mon, 27 Jan 2025 12:17:05 -1000

On 2025-01-27 05:22, Antoine Riard wrote:
> As soon as Alice's batch transaction starts to propagate, Mallet
> consumes its 2 outputs with 2 chain of junk transactions to reach max
> package limits (25 descendants) and block the carve-out. The junk
> transactions are of size 150 bytes and feerates 2 satoshis per virtual
> byte and they have 2 parents: one Alice's payout UTXO and one Mallet's
> UTXO.
> 
> Starting from this point, Alice's exchange server logic should either
> (a) attempts a CPFP or (b) attempts a RBF on the batch transaction. As
> there is no global mempool, Alice is uncertain on the explanation for
> the lack of propagation of her batch transaction [...]

Do I understand correctly that this attack only applies if Alice
attempts to fee bump her batch transaction?  In short, is this the
attack:

- Alice broadcasts a transaction.
- Mallet pins Alice.
- Alice doesn't realize she's been pinned and bumps the fees.
- The bump doesn't propagate due to the pin, but Mallet receives it
   anyway somehow.
- Mallet mines the fee bump, but nobody else mines it because it didn't
   propagate.  Mallet thus makes more money than other miners.

Thanks,

-Dave

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