Subject: Re: [bitcoin-dev] We need to fix the block withholding attack

From: Chris Priest <[email-masked]>
Date: Sat, 19 Dec 2015 19:43:59 -0800

Then shouldn't this be something the pool deals with, not the bitcoin protocol?

On 12/19/15, Matt Corallo <[email-masked]> wrote:
> Peter was referring to pool-block-withholding, not selfish mining.
>
> On December 19, 2015 7:34:26 PM PST, Chris Priest via bitcoin-dev
> <[email-masked]> wrote:
>>Block witholding attacks are only possible if you have a majority of
>>hashpower. If you only have 20% hashpower, you can't do this attack.
>>Currently, this attack is only a theoretical attack, as the ones with
>>all the hashpower today are not engaging in this behavior. Even if
>>someone who had a lot of hashpower decided to pull off this attack,
>>they wouldn't be able to disrupt much. Once that time comes, then I
>>think this problem should be solved, until then it should be a low
>>priority. There are more important things to work on in the meantime.
>>
>>On 12/19/15, Peter Todd via bitcoin-dev
>><[email-masked]> wrote:
>>> At the recent Scaling Bitcoin conference in Hong Kong we had a
>>chatham
>>> house rules workshop session attending by representitives of a super
>>> majority of the Bitcoin hashing power.
>>>
>>> One of the issues raised by the pools present was block withholding
>>> attacks, which they said are a real issue for them. In particular,
>>pools
>>> are receiving legitimate threats by bad actors threatening to use
>>block
>>> withholding attacks against them. Pools offering their services to
>>the
>>> general public without anti-privacy Know-Your-Customer have little
>>> defense against such attacks, which in turn is a threat to the
>>> decentralization of hashing power: without pools only fairly large
>>> hashing power installations are profitable as variance is a very real
>>> business expense. P2Pool is often brought up as a replacement for
>>pools,
>>> but it itself is still relatively vulnerable to block withholding,
>>and
>>> in any case has many other vulnerabilities and technical issues that
>>has
>>> prevented widespread adoption of P2Pool.
>>>
>>> Fixing block withholding is relatively simple, but (so far) requires
>>a
>>> SPV-visible hardfork. (Luke-Jr's two-stage target mechanism) We
>>should
>>> do this hard-fork in conjunction with any blocksize increase, which
>>will
>>> have the desirable side effect of clearly show consent by the entire
>>> ecosystem, SPV clients included.
>>>
>>>
>>> Note that Ittay Eyal and Emin Gun Sirer have argued(1) that block
>>> witholding attacks are a good thing, as in their model they can be
>>used
>>> by small pools against larger pools, disincentivising large pools.
>>> However this argument is academic and not applicable to the real
>>world,
>>> as a much simpler defense against block withholding attacks is to use
>>> anti-privacy KYC and the legal system combined with the variety of
>>> withholding detection mechanisms only practical for large pools.
>>> Equally, large hashing power installations - a dangerous thing for
>>> decentralization - have no block withholding attack vulnerabilities.
>>>
>>> 1) http://hackingdistributed.com/2014/12/03/the-miners-dilemma/
>>>
>>> --
>>> 'peter'[:-1]@petertodd.org
>>> 00000000000000000188b6321da7feae60d74c7b0becbdab3b1a0bd57f10947d
>>>
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>