2013-11-05 BusinessInsider - Researchers Say 'Bitcoin Is Broken', Could Collapse

[siennamar]

http://www.businessinsider.com/researchers-say-bitcoin-is-broken-and-could-collapse-2013-11

 
 
Two computer science researchers at Cornell University say they've uncovered a fundamental flaw in Bitcoin that is so bad, it could kill Bitcoin dead.

The problem is with how people "mine" bitcoins. Mining is how bitcoins are created. Most people don't mine bitcoins anymore. They buy them or take them as payment. But some people are in the business of mining coins with special bitcoin-mining computers. Even so, it is so difficult and time consuming for a computer to create new bitcoins that some miners have banded together in pools, using multiple computers that work together.
 

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[thebrit]

... which anybody who knows a damned thing about bitcoin is already aware of!!!

[bclcjunkie]

you're either new to bitcoin and unaware that this is rehashed old news... or... just spreading fud to knock the price down, not gonna happen.. i'll lean to the latter... 

http://www.businessinsider.com/researchers-say-bitcoin-is-broken-and-could-collapse-2013-11

 
 
Two computer science researchers at Cornell University say they've uncovered a fundamental flaw in Bitcoin that is so bad, it could kill Bitcoin dead.

The problem is with how people "mine" bitcoins. Mining is how bitcoins are created. Most people don't mine bitcoins anymore. They buy them or take them as payment. But some people are in the business of mining coins with special bitcoin-mining computers. Even so, it is so difficult and time consuming for a computer to create new bitcoins that some miners have banded together in pools, using multiple computers that work together.
 

[bclcjunkie]

this shouldn't even be in "auctions" section so you're bitcoin illiterate who is unaware that this is rehashed old news... or... just spreading fud to knock the price down, not gonna happen.. somehow my gut tells me you're the latter... 

http://techcrunch.com/2013/11/03/ebay-ceo-john-donahoe-is-bullish-on-digital-currency-and-hes-keeping-tabs-on-bitcoin/
http://www.coindesk.com/btc-china-beats-mt-gox-bitstamp-become-worlds-1-bitcoin-exchange/
http://www.coindesk.com/bitcoin-debit-cards-come-canada/

http://www.businessinsider.com/researchers-say-bitcoin-is-broken-and-could-collapse-2013-11

 
 
Two computer science researchers at Cornell University say they've uncovered a fundamental flaw in Bitcoin that is so bad, it could kill Bitcoin dead.

The problem is with how people "mine" bitcoins. Mining is how bitcoins are created. Most people don't mine bitcoins anymore. They buy them or take them as payment. But some people are in the business of mining coins with special bitcoin-mining computers. Even so, it is so difficult and time consuming for a computer to create new bitcoins that some miners have banded together in pools, using multiple computers that work together.
 

[lepirate]

Haha, I think they've read a post about it on BitcoinTalk and then gone to BI with it!

[vandeam]

Great News! NOW FIX IT! 

 

[kjlimo]

Sell sell sell (to me)... bummer no dip in price.

[Rygon]

Miners aren't going to devalue the coins they already hold or are planning on acquiring, by crashing the network. Furthermore, I think one of the primary drivers of mining is to exchange old bitcoins for fresh ones with not traceability.

[Akka]

Come on.

Are this "researchers" completely retarded?

That's how the proof of work system works. That's one of the fundamentals of Bitcoin. Are those "researchers" writing a Press release without even reading the Wikipedia article about Bitcoin.

Wonder what those guys "research" normally.

Edit: Obiously it was only the media that wrote Bullsh***. So everthing as above but at the Media.

[BlackBison]

Although the risk is greatly exaggerated, in fairness to the authors it is a new 'attack combo' they are outlining that has not been discussed before. It is essentially a modified, more complex version of the 51% attack that might require only 25% of the network hashrate.

In the end though its still a negligible risk imo.

[HeliKopterBen]

Its not the researchers who are blowing it out of proportion, its the media.  Im sure there are several variations of a "majority" attack but they all are very similar in nature and the risks are also similar in nature.

[FeedbackLoop]

I sure hope it cools down the exchange rate a little bit... I'm not done padding my portfolio with Bitcoin. Unfortunately (for me  ) I think media is quite warm on Bitcoin currently.

[StarfishPrime]

Too bad - it was looking like all this 'bitcoin is broken' FUD might provide a final buying opportunity under $250. Not to be.

The Chinese are clearly not falling for this nonsense.

[Arvicco]

Although the risk is greatly exaggerated, in fairness to the authors it is a new 'attack combo' they are outlining that has not been discussed before. It is essentially a modified, more complex version of the 51% attack that might require only 25% of the network hashrate.

In the end though its still a negligible risk imo.

I think this IS a 51% attack in disguise, and the scenario it describes is based on a faulty assumption.

Not only does this attack require at least 25% of the network to even start it, the attackers need to somehow coopt or trick additional 26% of miners to join them in the attack. It is all based on the assumption that the miners are "selfish" to the point of happily joining the attack for a minuscule short term benefit regardless of any long-term consequences. Such as potential destruction of the very network they are deriving their income from.

So, in reality this should play out like this. One of the major pools (such as BTCGuild or Eligius) suddenly starts acting weird, announces an intention to screw everyone and take over the network. Not only that, they invite everyone else to join their Evil Empire asap. "Selfish miners", out of their natural greed and malice, abandon the "honest" network and join up in droves until the "evil network" reaches 51%, overpowers honest miners and starts wrecking chaos...

How realistic is this scenario? Would not it be more realistic for the miners to move from the "rogue" pool instead, depriving it of any hashpower it previously held?

Why is anyone even discussing it seriously as something "novel" is beyond me...

[hacknoid]

Apparently now they have a "dumbed down" explanation that they wrote in their blog on, of all places, Business Insider (didn't know BI had blogs from CS researchers..)

http://www.businessinsider.com/this-is-why-bitcoin-is-broken-2013-11

This whole things sounds fishy to me.  Not what they detail, but in the fact of how they released it so publicly.  Also the fact that they gave no notice to the developers that they found this and were planning on publicizing it:

I'm short on time, and this was announced to the public without advanced notice to e.g. the bitcoin-security list. Making an informed response fast is hard.

IIRC, there was an issue found a few months ago that had a patched version of bitcoin-qt coded and released before the bug itself was announced.  Wouldn't that have been a more prudent option?

This sounds like, at best, some guys that are trying to get as much spotlight as possible, and at worst, a planned hit from the sectors most impacted by Bitcoin, which shall remain - anonymous.   

[vm1990]

look it the 51% attack... and weve known about it for how long... researches are getting dumber and dumber these days.... could you imagine if satoshi was a researcher. he would have cured cancer 3 times over by now

[freedomno1]

Intro to research fail 101, there are a ton

[CryptoBeggar]

The risk is real and out there. Only 1 % is required to act maliciously, but this 1 % miner would have very little chance of successfully finding one covert and one succeeding block before the other 99 % does.

[freedomno1]

The risk is real and out there. Only 1 % is required to act maliciously, but this 1 % miner would have very little chance of successfully finding one covert and one succeeding block before the other 99 % does.

As an aside the picture they choose sure looks a lot like Josh wish sunglasses lol
That or I have BFL vision