DDos on difficulty possible?

[antares]

hi there.

I've been thinking of this lately, but shouldn't there be a way to allow difficulty decreases more quickly?

Take the following figure:
the Current Network hashrate is something between 10 and 12 THash/sec.
Let's say some government/greedy banker/insert bad guy here figures bitcoin to be a threat.
They could easily deploy their own mining equipment and greatly increase difficulty until the next block is reached.
If you take numbers, adding about 150-200 additional TH/sec could drive up difficulty in a day to a value of about 10-15M.
I think that those computing powers are actually not too much for governments/intelligence agencies/wealthy banks.(actually I consider the NSA for example having such computational powers already).
Thing is, just forbidding bitcoin will probably not kill it, as it's kind of the same as with illegal downloads... people know it's illegal to download current movies from the internet, they still do it. So Govts/whoever hates BTC would be considering to shut down the network using this or another attack more probably than just pulling out laws against it.

So lets say, they do it.
After difficulty gets adjusted, the bitcoin hater pulls his miners out, reducing the hash-rate back to the normal 10-12TH/s.
With a difficulty of about 15M, the network would only generate about 16 Blocks/day, making it 126 days for difficulty to get recalculated.
However with that difficulty, most profit-oriented miners would probably pull out, as there's enough wealthy early adaptors that could buffer the price spike with their own wallets, and mining at 15M difficulty would be probably unreantable for anyone. So we could guess that the network would take about three times that value to recover from that difficulty spike. Bitcoin might be dead or forked by then.

There should be some consideration to have the network check average hashing speed every like 50 blocks for abnormal spikes in network power. For example, if the network hashing rate sunk by more than lets say 300% during the last 50 blocks, it could recompute difficulty to prevent such attacks on the coin.

What do you think about this?

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[sirky]

If you allow difficulty decreases more quickly, then you allow real DDoS attacks against large pools (or maybe even individual nodes in the BTC Network) to be more effective.

Hit all of the major pools, and then you get a bigger piece of the pie when the difficulty drops.

I might be missing something, but I think this is the counterargument.

Also, if someone wanted to be devious, and had that much hashing power, they could just fork the block chain at will, basically stopping mining in it's tracks, forever. So this scenario isn't really one you need to guard against (since worse attacks exist with that much hashing).

[patvarilly]

I tried to estimate the cost of taking over the network as of a few days ago here:

http://forum.bitcoin.org/index.php?topic=21905.msg287402#msg287402

Basically, it might cost about $1-$5M to set up the computing power needed nowadays, but if difficulty keeps rising exponentially, by the end of the year you're talking $100M-$500M.  Not unthinkable, but close.

[gigabytecoin]

This just happened in effect to the namecoin blockchain.

Wikileaks boasted about it's greatness and overnight the difficulty jumped from a few thousand to 55,000.

Now the community is struggling to solve a single block every few hours and the difficulty is going to go back down eventually, but every day that "next difficulty change" time jumps another few days... so it's going to take a while!

So yes it is possible, but it will not be possible once bitcoin really goes mainstream, and that is all that matters.

[Ian Maxwell]

1. The difficulty can't increase by more than 4x per 2016 blocks, as a measure against exactly this sort of "attack".
2. The "attack", as others pointed out, would cost several million dollars.
3. Even if you did succeed, it's not clear what harm you would have done. You would have a lot of bitcoins and new ones would come into circulation more slowly. If you held or destroyed your bitcoins, the resulting shortage of new money would lead to an increase in the value of bitcoins. Come to think of it, I kind of hope someone tries this "attack".