Manipulating the difficulty?

[PLATO]

Hah. Awesome. I missed that

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[ryepdx]

It's still something to consider, as this is one attack avenue I don't think that I've seen discussed on this forum before.

Remember the Mystery Miner?

Are you implying that the 'Mystery Miner' was such an exploit? 

Not at all. I just thought I remembered seeing this exploit being kicked around a bit during that period, that's all. The Mystery Miner does, however, show that it is possible (however unlikely) for a single, determined user to manipulate the network's difficulty.

How might this harm the network. or introduce another fraud vector?

Well, there's that double-spend vector that keeps getting kicked about. Also...

Okay, so how would this attack vector aid in a double spend fraud? 

It would shake out small miners...

...which could lead to a person eventually taking control of over 50% of the network with computing power equal to a value less than 50% of the network's power at the time of the attack's commencement.

How?

Those last two are kinda two sides to the same coin. If a person were to procure enough computing power to single-handedly alter the difficulty level, they can essentially control how profitable mining is for everyone else, at least to a degree. If they managed to up the difficulty such that mining ceased to be profitable for anyone else, other miners would start dropping out. The network's total computing power would wane as a result, with an ever greater percentage of it being composed of the attacker's machines. If the attacker had made up less than half the network when they began upping the difficulty, it's possible that with other miners dropping out they would eventually come to own a majority share (so to speak.)

[Jim Hyslop]

Remember the Mystery Miner?

I think the Mystery Miner predates me. Got a link to discussions on it/him/her?

[Jim Hyslop]

Imagine Google can summon 5.4 TH/s of power. The current hashrate is .6 TH/s.

Where did you find that figure? I've been thinking about analyzing the P2P network's combined hash power, but if someone else has already done it I won't bother.

[MoonShadow]

The current hashrate is .6 TH/s.

Where did you find that figure? I've been thinking about analyzing the P2P network's combined hash power, but if someone else has already done it I won't bother.

http://bitcoinwatch.com/

It's near the bottom on the left column.

[MoonShadow]

Remember the Mystery Miner?

I think the Mystery Miner predates me. Got a link to discussions on it/him/her?

Not really, it was just a spike and follow-up drop in the hashrate a couple of weeks ago.  Someone just referred to it as our "mystery miner" and it just stuck.  We don't have any evidence that it was a single entity, or several with bad timing.  My best guess about the whole thing is that someone tried renting out the cloud to mine for a bit, before having the facepalm moment when they finally realize that it's going to be hard for them to pay rent five times higher than the value of the bitcoins and make it up on volume.  Another credible possibility was that someone with a botnet was benchmarking their network.  The truth is that it is actually impossible for us to ever know any details, so we are all just guessing.

[molecular]

Imagine Google can summon 5.4 TH/s of power. The current hashrate is .6 TH/s. For the sake of simplicity let's say difficulty adjusts every 2000 blocks.

Blocks 1-10000: Business as usual; network ends at .6 TH/s.
Block 10001: Difficulty resets. Google turns on their network; starts hashing.
Blocks 10001-12000: Google finds these blocks approximately 10 times faster than they should, or, approximately one per minute.
Block 12001: Difficulty spikes to approximately 10 times the last difficulty. Google shuts off their network; hashrates are now .6 TH/s again.
Block 12001-14000: The network finds these blocks approximately 10 times slower than they should; or, approximately, one block per hour. Instead of taking two weeks, the next difficulty reset takes five months.

Except that can't work.  As I mentioned earlier, there is a difficulty adjustment parameter rule that prohibits the difficulty from adjusting up or down by more than a factor of four.  So the max that can be expected is that the Google can do is move the difficulty by that factor of four, which may or may not actually be worthwhile, but if the attack cannot be repeated in consecutive cycles (maybe, but I would say that it would be very unlikely to work out that way) then it's probably not a worthwhile means of manipulation for profit motives alone.  What kind of harm to the system itself could such an attack cause?

Motive questions moved aside.

The factor four thing wont really help, I think, because google could just do the attack for 2 consecutive difficulty adjustment periods and raise the difficulty by up to a factor of 16.

Also, in such a scenario, it should be possible for the majority of nodes to decide to change the rules to somehow adjust the difficulty more quick. This might bring up some trustworthiness issues, since we keep saying the rules cannot be changed easily, but I think in such a case a majority could form. On the other hand: we've got quite a few coins in circulation, doesn't really hurt to have mining slowed for half a year, does it?

[MoonShadow]

Imagine Google can summon 5.4 TH/s of power. The current hashrate is .6 TH/s. For the sake of simplicity let's say difficulty adjusts every 2000 blocks.

Blocks 1-10000: Business as usual; network ends at .6 TH/s.
Block 10001: Difficulty resets. Google turns on their network; starts hashing.
Blocks 10001-12000: Google finds these blocks approximately 10 times faster than they should, or, approximately one per minute.
Block 12001: Difficulty spikes to approximately 10 times the last difficulty. Google shuts off their network; hashrates are now .6 TH/s again.
Block 12001-14000: The network finds these blocks approximately 10 times slower than they should; or, approximately, one block per hour. Instead of taking two weeks, the next difficulty reset takes five months.

Except that can't work.  As I mentioned earlier, there is a difficulty adjustment parameter rule that prohibits the difficulty from adjusting up or down by more than a factor of four.  So the max that can be expected is that the Google can do is move the difficulty by that factor of four, which may or may not actually be worthwhile, but if the attack cannot be repeated in consecutive cycles (maybe, but I would say that it would be very unlikely to work out that way) then it's probably not a worthwhile means of manipulation for profit motives alone.  What kind of harm to the system itself could such an attack cause?

Motive questions moved aside.

The factor four thing wont really help, I think, because google could just do the attack for 2 consecutive difficulty adjustment periods and raise the difficulty by up to a factor of 16.

For the attack to work once, it already requires that the attacker have control of at least one of the blocks wherein the difficulty is adjusted (perhaps both) that buffet a 2016 block set.  To do this attack twice in a row requires that the attacker be able to reliablely control at least two of these critical blocks in succession.  If the attacker has that kind of processing power at hand, then the 50% takeover issue is probably within reach.

Also, in such a scenario, it should be possible for the majority of nodes to decide to change the rules to somehow adjust the difficulty more quick. This might bring up some trustworthiness issues, since we keep saying the rules cannot be changed easily, but I think in such a case a majority could form. On the other hand: we've got quite a few coins in circulation, doesn't really hurt to have mining slowed for half a year, does it?

The majority rules cannot be changed in such a fashion.  The only way that the protocol rules can be changed is if the majority of the potential generating userbase (which is larger than that actuall generating base) we to agree to change the rules, and vote by downloading a new client that repected those rules.  It couldn't just happen during a relatively short time frame, because once that attack ended, which it must eventually, the entire network would revert to the existing protocol stack, and any temporary changes made by the attacker by brute force would simply be undone, and all of the attacker's new blocks rejected.  Resulting in the atacker gaining nothing for his efforts.

Honestly, it probably woulnd't harm the Bitcoin network at this point, but in the future it might make getting honest tranasctions into the blockchain difficult, which could impact further adoption.

[gigabytecoin]

Imagine Google can summon 5.4 TH/s of power. The current hashrate is .6 TH/s. For the sake of simplicity let's say difficulty adjusts every 2000 blocks.

Blocks 1-10000: Business as usual; network ends at .6 TH/s.
Block 10001: Difficulty resets. Google turns on their network; starts hashing.
Blocks 10001-12000: Google finds these blocks approximately 10 times faster than they should, or, approximately one per minute.
Block 12001: Difficulty spikes to approximately 10 times the last difficulty. Google shuts off their network; hashrates are now .6 TH/s again.
Block 12001-14000: The network finds these blocks approximately 10 times slower than they should; or, approximately, one block per hour. Instead of taking two weeks, the next difficulty reset takes five months.

Except that can't work.  As I mentioned earlier, there is a difficulty adjustment parameter rule that prohibits the difficulty from adjusting up or down by more than a factor of four.  So the max that can be expected is that the Google can do is move the difficulty by that factor of four, which may or may not actually be worthwhile, but if the attack cannot be repeated in consecutive cycles (maybe, but I would say that it would be very unlikely to work out that way) then it's probably not a worthwhile means of manipulation for profit motives alone.  What kind of harm to the system itself could such an attack cause?

If someone had access to 100 tera hashes per second... they could user 10 for the first 2016 blocks, 25 for the next, 50 for the next, and 100 for the next 2016 blocks... and then leave... placing us in a predicament that takes more than a few hours to allow a transaction through the network...

[Jered Kenna (TradeHill)]

Imagine Google can summon 5.4 TH/s of power. The current hashrate is .6 TH/s. For the sake of simplicity let's say difficulty adjusts every 2000 blocks.

Blocks 1-10000: Business as usual; network ends at .6 TH/s.
Block 10001: Difficulty resets. Google turns on their network; starts hashing.
Blocks 10001-12000: Google finds these blocks approximately 10 times faster than they should, or, approximately one per minute.
Block 12001: Difficulty spikes to approximately 10 times the last difficulty. Google shuts off their network; hashrates are now .6 TH/s again.
Block 12001-14000: The network finds these blocks approximately 10 times slower than they should; or, approximately, one block per hour. Instead of taking two weeks, the next difficulty reset takes five months.

Except that can't work.  As I mentioned earlier, there is a difficulty adjustment parameter rule that prohibits the difficulty from adjusting up or down by more than a factor of four.  So the max that can be expected is that the Google can do is move the difficulty by that factor of four, which may or may not actually be worthwhile, but if the attack cannot be repeated in consecutive cycles (maybe, but I would say that it would be very unlikely to work out that way) then it's probably not a worthwhile means of manipulation for profit motives alone.  What kind of harm to the system itself could such an attack cause?

If someone had access to 100 tera hashes per second... they could user 10 for the first 2016 blocks, 25 for the next, 50 for the next, and 100 for the next 2016 blocks... and then leave... placing us in a predicament that takes more than a few hours to allow a transaction through the network...

Seems like it's a big part of it is motivation and the goal. It's going to be a lot easier to damage bitcoin than rip it off. Just like it's easier to break the windows on a bank than it is to rob it.
With the expensive of damaging it though I don't see anyone out side of governments or maybe a competing currency if google started one that would go to that effort.
Obviously if it were super villain that just did evil things you could explain it but I doubt anyone with that power just throws it around.

[MoonShadow]

Imagine Google can summon 5.4 TH/s of power. The current hashrate is .6 TH/s. For the sake of simplicity let's say difficulty adjusts every 2000 blocks.

Blocks 1-10000: Business as usual; network ends at .6 TH/s.
Block 10001: Difficulty resets. Google turns on their network; starts hashing.
Blocks 10001-12000: Google finds these blocks approximately 10 times faster than they should, or, approximately one per minute.
Block 12001: Difficulty spikes to approximately 10 times the last difficulty. Google shuts off their network; hashrates are now .6 TH/s again.
Block 12001-14000: The network finds these blocks approximately 10 times slower than they should; or, approximately, one block per hour. Instead of taking two weeks, the next difficulty reset takes five months.

Except that can't work.  As I mentioned earlier, there is a difficulty adjustment parameter rule that prohibits the difficulty from adjusting up or down by more than a factor of four.  So the max that can be expected is that the Google can do is move the difficulty by that factor of four, which may or may not actually be worthwhile, but if the attack cannot be repeated in consecutive cycles (maybe, but I would say that it would be very unlikely to work out that way) then it's probably not a worthwhile means of manipulation for profit motives alone.  What kind of harm to the system itself could such an attack cause?

If someone had access to 100 tera hashes per second... they could user 10 for the first 2016 blocks, 25 for the next, 50 for the next, and 100 for the next 2016 blocks... and then leave... placing us in a predicament that takes more than a few hours to allow a transaction through the network...

This sounds like the old joke, "I always give 100% of my efforts at work!  10% on Mondays, 25% on Tuesdays, 50% on Wendsdays...."

Tell me this, if any single entity had access to the kind of hashing power to make this work, why bother with such a complex attack vector?  Why not just simply dominate the network?

[Jered Kenna (TradeHill)]

Imagine Google can summon 5.4 TH/s of power. The current hashrate is .6 TH/s. For the sake of simplicity let's say difficulty adjusts every 2000 blocks.

Blocks 1-10000: Business as usual; network ends at .6 TH/s.
Block 10001: Difficulty resets. Google turns on their network; starts hashing.
Blocks 10001-12000: Google finds these blocks approximately 10 times faster than they should, or, approximately one per minute.
Block 12001: Difficulty spikes to approximately 10 times the last difficulty. Google shuts off their network; hashrates are now .6 TH/s again.
Block 12001-14000: The network finds these blocks approximately 10 times slower than they should; or, approximately, one block per hour. Instead of taking two weeks, the next difficulty reset takes five months.

Except that can't work.  As I mentioned earlier, there is a difficulty adjustment parameter rule that prohibits the difficulty from adjusting up or down by more than a factor of four.  So the max that can be expected is that the Google can do is move the difficulty by that factor of four, which may or may not actually be worthwhile, but if the attack cannot be repeated in consecutive cycles (maybe, but I would say that it would be very unlikely to work out that way) then it's probably not a worthwhile means of manipulation for profit motives alone.  What kind of harm to the system itself could such an attack cause?

If someone had access to 100 tera hashes per second... they could user 10 for the first 2016 blocks, 25 for the next, 50 for the next, and 100 for the next 2016 blocks... and then leave... placing us in a predicament that takes more than a few hours to allow a transaction through the network...

This sounds like the old joke, "I always give 100% of my efforts at work!  10% on Mondays, 25% on Tuesdays, 50% on Wendsdays...."

Tell me this, if any single entity had access to the kind of hashing power to make this work, why bother with such a complex attack vector?  Why not just simply dominate the network?

Hypothetically if they had that much power and were trying to destroy not just manipulate the btc economy they could easily right? Obviously it can come back etc but they could cause some serious problems.

[MoonShadow]

Imagine Google can summon 5.4 TH/s of power. The current hashrate is .6 TH/s. For the sake of simplicity let's say difficulty adjusts every 2000 blocks.

Blocks 1-10000: Business as usual; network ends at .6 TH/s.
Block 10001: Difficulty resets. Google turns on their network; starts hashing.
Blocks 10001-12000: Google finds these blocks approximately 10 times faster than they should, or, approximately one per minute.
Block 12001: Difficulty spikes to approximately 10 times the last difficulty. Google shuts off their network; hashrates are now .6 TH/s again.
Block 12001-14000: The network finds these blocks approximately 10 times slower than they should; or, approximately, one block per hour. Instead of taking two weeks, the next difficulty reset takes five months.

Except that can't work.  As I mentioned earlier, there is a difficulty adjustment parameter rule that prohibits the difficulty from adjusting up or down by more than a factor of four.  So the max that can be expected is that the Google can do is move the difficulty by that factor of four, which may or may not actually be worthwhile, but if the attack cannot be repeated in consecutive cycles (maybe, but I would say that it would be very unlikely to work out that way) then it's probably not a worthwhile means of manipulation for profit motives alone.  What kind of harm to the system itself could such an attack cause?

If someone had access to 100 tera hashes per second... they could user 10 for the first 2016 blocks, 25 for the next, 50 for the next, and 100 for the next 2016 blocks... and then leave... placing us in a predicament that takes more than a few hours to allow a transaction through the network...

This sounds like the old joke, "I always give 100% of my efforts at work!  10% on Mondays, 25% on Tuesdays, 50% on Wendsdays...."

Tell me this, if any single entity had access to the kind of hashing power to make this work, why bother with such a complex attack vector?  Why not just simply dominate the network?

Hypothetically if they had that much power and were trying to destroy not just manipulate the btc economy they could easily right? Obviously it can come back etc but they could cause some serious problems.

True, but Bitcoin is subject to overwelming computations anyway.  Which is why the system is designed to encourage participation in the hashing that keeps the blockchain strong.