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Researchers Locate Flaw In Bitcoin Protocol

Unknown Lamer posted more than 2 years ago | from the path-of-least-information dept.

Bitcoin 191

An anonymous reader writes "Researchers at Microsoft Research and Cornell identified a potential flaw in Bitcoin's transaction propagation. In a recent paper they show how miner nodes in the Bitcoin network have an incentive not to relay transactions to the rest of the network, and propose to implement a scheme that rewards nodes [PDF] for relaying messages."

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I'm starting to want to work at Microsoft Research (3, Insightful)

CmdrPony (2505686) | more than 2 years ago | (#38057642)

They seem to do lot of cool stuff. From that Courier tablet to studying Bitcoin. Even while Microsoft doesn't realize their R&D section has a great amount of potential, it's actually the only major company in the industry that does have such research center. I wish I worked there :-P

Re:I'm starting to want to work at Microsoft Resea (3, Insightful)

Anonymous Coward | more than 2 years ago | (#38057680)

Well, IBM do have a fairly large research division too.

Re:I'm starting to want to work at Microsoft Resea (0)

Anonymous Coward | more than 2 years ago | (#38058148)

Fairly large? Second only to Microsoft. And it's one of the best places you could work at.

IBM spends really a large amount of money on R&D. I wish the coffee were free, tho. Google does that right.

Re:I'm starting to want to work at Microsoft Resea (5, Funny)

somersault (912633) | more than 2 years ago | (#38057694)

You're the guy that said he worked in marketing yesterday. Why is it that all UIDs over 2,000,000 seem to do marketing for MS?

Re:I'm starting to want to work at Microsoft Resea (2, Interesting)

qxcv (2422318) | more than 2 years ago | (#38057846)

I think the real question here is why all UIDs under 2,000,000 don't do marketing for MS. But seriously, their R&D department do some pretty cool stuff. Even though MS manage to churn out nine-nines of crap products, occasionally they still come out with something awesome that they manage to get to market (think Kinect). Shame they spend the rest of their time suing their competitors, churning out garbage like Windows and spreading FUD.

Re:I'm starting to want to work at Microsoft Resea (3, Interesting)

drinkypoo (153816) | more than 2 years ago | (#38057920)

But seriously, their R&D department do some pretty cool stuff. Even though MS manage to churn out nine-nines of crap products, occasionally they still come out with something awesome that they manage to get to market (think Kinect).

The problem with that idea is that Kinect was a 90%+ finished product when they bought it. They polished it for use with the 360, it always takes them some time to fuck up a new technology sufficiently for their branding, and kicked it out the door. And it's taking them how long to kick out a PC version even though hobbyists have been doing it all along? Microsoft is pathetic at everything but illegally exploiting their opportunities and believing otherwise is ignorant at best.

Re:I'm starting to want to work at Microsoft Resea (1)

Chrisq (894406) | more than 2 years ago | (#38057922)

do marketing for MS. But seriously, their R&D department do some pretty cool stuff. Even though MS manage to churn out nine-nines of crap products, occasionally they still come out with something awesome that they manage to get to market (think Kinect).

On other occasions they just patent it so that nobody else will

Re:I'm starting to want to work at Microsoft Resea (3, Funny)

rtfa-troll (1340807) | more than 2 years ago | (#38058782)

This;

The stability of the current desktop computer market is so important to Microsoft that they will practically never actually innovate. They have an R&D department for two reasons. 1) To keep the ideas away from other companies by patenting them and then not licensing them onward 2) To keep the good people away from other companies by using them to create patents.

The reason not to work for Microsoft R&D is that, whilst you will be comfortable, well fed and well off, you will lead an empty life and they will suck your soul out of you.

Re:I'm starting to want to work at Microsoft Resea (1)

somersault (912633) | more than 2 years ago | (#38057956)

I got bored of the Wii gimmick and PS Move pretty quick. So I didn't even bother buying Kinect for my 360. How is it any better? I'm not interested in dancing games, and while I used to fantasize about full body motion fighting games as a teenager, I know now that doing that doing that type of violent motion without any resistance (ie a punching bag or opponent) is pretty bad for your joints in the long run.

MS do manage to hit on good ideas every now and then, and it's good that they have a research lab. They're definitely not the only computer research lab out there. What about Bell labs? And Google Labs and 20% or whatever projects? The original poster claiming MS are the only guys that do research is pure BS.

Re:I'm starting to want to work at Microsoft Resea (1)

CmdrPony (2505686) | more than 2 years ago | (#38058026)

I don't own Kinect myself, but my parents do. I do own Wii, and to be honest, Kinect is way nicer to use. For one, you don't need to hold any controller. Secondly, it seems to register your movements much better than Wii does. MS probably wouldn't had come up with it if it wasn't for Wii, but they did it so much better. I haven't tested PS Move so cannot comment on that, but it seems to be controller based like Wii.

Re:I'm starting to want to work at Microsoft Resea (1)

DrXym (126579) | more than 2 years ago | (#38058376)

PS Move works like a Wii Plus remote, but is more accurate. The remote relays it's pitch, rotation etc. and the PS3 does some simply geometry to track the ball on the end to work out it's exact position in space. It's remarkably accurate. That said there haven't been many standout titles for it. Like Kinect, most games only include a move experience as some kind of afterthought, e.g. a mini game or whatever, or throw it in as an alternative control scheme. I tried the controls with Killzone 3 and thought it was pretty awkward though some people appear to like it. More successful are where it was integrated with EyePet and Heavy Rain strangely. Best example of it in use has to be Tumble where you can pick up blocks and build towers to complete challenges.

Re:I'm starting to want to work at Microsoft Resea (1)

DrXym (126579) | more than 2 years ago | (#38058316)

Kinect isn't any better. Defenders will claim how it's oh so much more than an EyeToy but the net result is a glorified EyeToy. Most of the games rely on you performing simplistic exaggerated body motions and as may be expected not many traditional games map onto simplistic exaggerated body motions.

So due to the nature and limitations of the device it has sunk almost immediately into a morass of shovelware with dance & fitness games massively over represented and others which have throwaway mini games bolted onto the side of traditional control main game. Some titles do standout however such as Once Upon a Monster for doing something interesting with the tech.

The main buzz for the tech appears to be from hackers who discovered you can do some neat things with a camera with some depth finding capabilities.

Re:I'm starting to want to work at Microsoft Resea (1)

CmdrPony (2505686) | more than 2 years ago | (#38058354)

The main buzz for the tech appears to be from hackers who discovered you can do some neat things with a camera with some depth finding capabilities.

And Microsoft actually responded to that a lot differently than Sony or Nintendo - They're bringing Kinect support to PC as well, and have released API's to use it.

Re:I'm starting to want to work at Microsoft Resea (3, Interesting)

DrXym (126579) | more than 2 years ago | (#38058416)

And Sony haven't done that? Oh wait they did [playstation.com] .

Re:I'm starting to want to work at Microsoft Resea (3, Interesting)

EdZ (755139) | more than 2 years ago | (#38058366)

I got bored of the Wii gimmick and PS Move pretty quick. So I didn't even bother buying Kinect for my 360. How is it any better?

It's not. All three non-haptic (don't give me that "vibration is feedback" claptrap!) motion gaming controllers are absolutely horrible to use.

However, the Kinect is an amazing machine vision system. SLAM, 3d scanning, etc, all for something the size of a Toblerone you can buy off-the-shelf for cheap.

Re:I'm starting to want to work at Microsoft Resea (1)

Anonymous Coward | more than 2 years ago | (#38058660)

The Kinect is "early" in Natural Interface (OpenNI) for computers. Consider the Xbox360 Kinect as a early prototype. Right now it's killer use is 3D model rigging, posing and blocking for 3D animation movies (Just look up some of the mid to late 2011 MikuMiku Dance videos which let you use the Kinect for posing.)

It's much in the same line as how Film and Videotape video cameras evolved. Early models are expensive and low resolution, later models should have higher resolution and more points to model. I believe the current Kinect only has like 12 trackable points. So you only have the option of full body stiff movement, or face movement, not both.

The Wiimote and PS Move could technically be used in the same manner, but you only get two trackable points (assuming you have two wiimotes or two ps move controllers.) The PS Move is clearly a knockoff of the Wiimote, and there's no way you can say it isn't. In fact it pretty much works exactly the same as the Wiimote except the Infrared tracking is generated by the remote and captured by the camera, instead of in the wiimote which has the infrared generated by the Wii base unit, and the wiimote has the IR tracking in the device itself. Technically the wiimote is cheaper, but not by much.

Re:I'm starting to want to work at Microsoft Resea (1)

somersault (912633) | more than 2 years ago | (#38058732)

The PS Move is clearly a knockoff of the Wiimote, and there's no way you can say it isn't.

I wouldn't try to say that it isn't. It's a knockoff that improves a lot on the original though. I haven't tried Wii motion plus though so I can't say how that compares. I only used my Move with the demos it came with though - I haven't seen any games come out that I'd actually want to play with it. If a good game came out for Kinect or any other future control system, then I'd buy it of course. But they're all just gimmicky garbage so far. It's a shame that Rock Band and Guitar Hero were so overdone, I'd rather see a steady stream of improvements with specialised controllers for certain game types.

Re:I'm starting to want to work at Microsoft Resea (2)

Pf0tzenpfritz (1402005) | more than 2 years ago | (#38058532)

I think the real question here is why all UIDs under 2,000,000 don't do marketing for MS.

Stupid question. We're too old.

Re:I'm starting to want to work at Microsoft Resea (1)

Requiem18th (742389) | more than 2 years ago | (#38058976)

I think the real question here is why all UIDs under 2,000,000 don't do marketing for MS.

Authenticity.

Re:I'm starting to want to work at Microsoft Resea (0)

Anonymous Coward | more than 2 years ago | (#38058056)

Because the perception of developers to Microsoft has changed radically since Slashdot's founding. They've gone from being the evil empire to a developer-company with many cool toys.

Re:I'm starting to want to work at Microsoft Resea (2)

somersault (912633) | more than 2 years ago | (#38058244)

Not sure what planet you're living on.. Apple has become a second evil empire which may make MS seem slightly more reasonable in some cases - but MS is still obviously an evil empire in itself. As soon as their anti-trust oversight was up earlier this year, it was straight back to the BS. I feel dirty even thinking about looking at an MS product like .NET.

Re:I'm starting to want to work at Microsoft Resea (0)

CmdrPony (2505686) | more than 2 years ago | (#38058910)

What's so bad about .NET? Apart from your prejudice. It's actually good platform, and C# is awesome language for developers. .NET is also fully open. The reason why the newest versions aren't fully supported in Linux is just because of this - the general hate towards Microsoft and their success with Windows. Microsoft does give out the specs, but Linux developers don't want to update their programs. That's really hardly Microsoft's fault.

Re:I'm starting to want to work at Microsoft Resea (2)

davidbrit2 (775091) | more than 2 years ago | (#38058230)

That's about how long it took MS to find out about Slashdot.

Re:I'm starting to want to work at Microsoft Resea (0)

Anonymous Coward | more than 2 years ago | (#38057754)

actually the only major company

Nope. Plenty of big companies have research divisions.
Microsoft's one is just one you hear a lot about because they do it for marketing reasons as well as research.
Typically very little of that research ever makes it out of there, though.

Re:I'm starting to want to work at Microsoft Resea (1)

JasterBobaMereel (1102861) | more than 2 years ago | (#38058688)

Like IBM have had for years you mean ....IBM is a small company that produces software and some other stuff ...

It's research department is quite well known ... five Nobel Prizes, four Turing Awards, nine National Medals of Technology, and five National Medals of Science.

Courier Tablet - sorry no-one seems to have heard of it, is that anything like the iPad or the Galaxy Tablet ?

Re:I'm starting to want to work at Microsoft Resea (1)

JoeMerchant (803320) | more than 2 years ago | (#38058696)

it's actually the only major company in the industry that does have such research center. I wish I worked there :-P

Google X might be larger, if anyone knew where it was....

Re:I'm starting to want to work at Microsoft Resea (1)

RyuuzakiTetsuya (195424) | more than 2 years ago | (#38058798)

Yeah and that's great and all, if you just want to crap out useless prototypes that never actually go anywhere(the BitCoin research is pretty cool though)... heaven forbid you have an idea that threatens Office, Windows or the Xbox divisions.

Life at Microsoft R&D must be some bizarre sisyphean effort that's somehow rewarding when you *almost* get that boulder up the hill.

Yes but (4, Funny)

koan (80826) | more than 2 years ago | (#38057660)

It still sounds like a better system than our current financial institutions.

Re:Yes but (0)

CmdrPony (2505686) | more than 2 years ago | (#38057682)

At least with current banking systems you get some stability. With Bitcoin you can lose 30% of your money overnight. What Bitcoin desperately needs is to stabilize its value.

Re:Yes but (4, Insightful)

somersault (912633) | more than 2 years ago | (#38057738)

As someone said before, Bitcoin would be a lot more valuable if your currency held the promise of something. For example selling your computer time makes much more sense than doing calculations designed to waste computing power. I've wondered before if there was anything to Bitcoin, but I really can't think of it as a currency. I think of it more like the stock market, and how I can abuse it to make a profit. In the end I'm better off just making money doing real work.

Re:Yes but (2)

Chrisq (894406) | more than 2 years ago | (#38057944)

As someone said before, Bitcoin would be a lot more valuable if your currency held the promise of something. For example selling your computer time makes much more sense than doing calculations designed to waste computing power. I've wondered before if there was anything to Bitcoin, but I really can't think of it as a currency. I think of it more like the stock market, and how I can abuse it to make a profit. In the end I'm better off just making money doing real work.

Unfortunately in this world doing real work is the one thing that will guarantee that you only get a commodity level of pay. That's why stockbrokers and lawyers make more than programmers or mechanics

Re:Yes but (1, Insightful)

CmdrPony (2505686) | more than 2 years ago | (#38058374)

Unfortunately in this world doing real work is the one thing that will guarantee that you only get a commodity level of pay. That's why stockbrokers and lawyers make more than programmers or mechanics

It's all based on supply and demand. Frankly, mechanics and programmers are quite common place jobs. Good stockbrokers and lawyers, not so much. And I'm a programmer myself, but I understand the position rather than just going "lalala".

Re:Yes but (2)

benjamindees (441808) | more than 2 years ago | (#38059022)

It's all based on supply and demand.

Bullshit. Stockbrokers and lawyers are licensed and subsidized. The supply is artificially limited by government fiat, and demand is artificially increased. Not so for mechanics and programmers. And that's the reason for the difference. It has nothing to do with natural supply and demand.

Re:Yes but (-1)

Anonymous Coward | more than 2 years ago | (#38058502)

> As someone said before, Bitcoin would be a lot more valuable if your currency held the promise of something.

When people mined for gold, the didn't dig because they liked the shinny metal, they dug because they could buy nice things with that gold; now we call it "having a job", but it is essentially the same, and we do it because we can buy houses and cars with the money we earn, not because we can exchange that money into some other currency.

What can you buy now with bitcoins? Nothing: there are a few merchants that accept bitcoins, but they also accept dollars; and why would anybody bother to buy / mine bitcoins, if they can use real money directly? So the actual value of a bitcoin is almost zero, precisely because there is almost nothing you want to buy with them.

Let's imagine who could be interested to use bitcoins for real. Must be someone buying illegal goods, otherwise they would use dollars. And he must be interested in something that can be downloaded, because having it shipped to a physical address breaks the whole point. Pirated content is out of the question, as it can be found easily, already. So, what's left...child porn.

And thus the conclusion is that only child porn can save bitcoin.

Re:Yes but (1)

DarkOx (621550) | more than 2 years ago | (#38058708)

Not to defend BT, but just because it does not represent something specific does not make it so different form other currencies.

You might just as well say

Dollars would be a lot more valuable if your currency held the promise of something. For example selling shares in the nations store of gold makes much more sense than doing massive printing for the sake of wasting cotton, wood fiber and ink. I've wondered before if there was anything to Dollars, but I really can't think of them as a currency.

Yes I realize that one *value* aspect of the dollar is it can satisfy tax obligations but even that is pretty artificial construct.

Re:Yes but (1)

somersault (912633) | more than 2 years ago | (#38058770)

I'm aware of that, but the dollar has evolved such that it does hold the promise of value, because it's already accepted all over. You can't just get BitCoin accepted by saying it "should" be accepted. I'd rather have something like Zynga credits or WoW than a bitcoin, despite not wanting to play WoW or any Zynga games. At least those currencies have some kind of possible use for millions of people.

Re:Yes but (0)

Anonymous Coward | more than 2 years ago | (#38058756)

For the moment I only see Bitcoin as liquid gold. If I have gold and silver somewhere and would like to move it then I can sell it locally and buy Bitcoins with it. Then I transmit the Bitcoins and buy more gold and silver on the other side.

Re:Yes but (3, Informative)

Vaphell (1489021) | more than 2 years ago | (#38057740)

stability comes from the size of userbase. More users = greater inertia.
Either way central banks have no problem with playing dirty. Imagine having tons of swiss francs and losing 8% in a matter of seconds as it happened early September when they announced pegging to euro.

Re:Yes but (1)

EdZ (755139) | more than 2 years ago | (#38058380)

Stability comes from distribution of currency. Concentrate it too much, and the whole thing becomes unstable. Bitcoin suffers from this, with a few hoarders buying and dumping causing the value to fluctuate wildly. Unfortunately, 'proper' currency is also subject to this concentration of wealth, as is currently becoming very clear.

Re:Yes but (2, Informative)

Anonymous Coward | more than 2 years ago | (#38057756)

BitCoin is a proof of concept, not a currency.

Re:Yes but (1)

benjamindees (441808) | more than 2 years ago | (#38057780)

It has current value and can be easily used as a medium of exchange. It is a currency by definition.

Re:Yes but (0)

Anonymous Coward | more than 2 years ago | (#38058094)

No, I can't go to my exchange bureau and get money for my bitcoin.

It's just like some goofy "point" you can get in some place, usable only in certain shop and restaurant.

Re:Yes but (1)

Anonymous Coward | more than 2 years ago | (#38058458)

There are over 30 [bitcoin.it] currency exchanges that trade in Bitcoins. So that's simply false.

Re:Yes but (2, Insightful)

RoFLKOPTr (1294290) | more than 2 years ago | (#38058516)

There are over 30 [bitcoin.it] currency exchanges that trade in Bitcoins. So that's simply false.

Wow there's more currency exchanges for Bitcoins than merchants that accept them!

Re:Yes but (4, Insightful)

Talderas (1212466) | more than 2 years ago | (#38058504)

It's currency in the sense that pinto beans are a currency.

Re:Yes but (1)

shentino (1139071) | more than 2 years ago | (#38057820)

The problem with bitcoin from my point of view is that it's too damn easy to steal.

At least with cold hard cash you have to be pickpocketed or burglarized before you lose it. With bitcoin all you need is some two bit hacker taking advantage of a technophobe running a jacked computer and bam, all his bitcoins are belong to the haxxors.

All it takes is one rogue hacker to misdirect bitcoin payments and you have instant skimming.

And since it competes with government control, civil authorities won't investigate bitcoin fraud like they will fraud involving real money.

Re:Yes but (1)

Issarlk (1429361) | more than 2 years ago | (#38057980)

if you leave your life savings in cold hard cash on the living room table you are effectively one burglary away from losing everything.
But just as you put your savings in a bank, you can put your bitcoins in another account. Extract from https://en.bitcoin.it/wiki/Securing_your_wallet [bitcoin.it] :
"A good practice is to keep at least two wallets, one as a "current account" for everyday transactions and one as a "savings account" where you store the majority of your Bitcoins.
The "savings account" wallet should be backed up in encrypted form only and all plaintext copies of this wallet should be erased. In case someone gains unauthorised access to your computer (either by physically stealing it or by exploiting a system vulnerability via the internet), they will only be able to spend the coins in your "current account" wallet."

Re:Yes but (1)

FireFury03 (653718) | more than 2 years ago | (#38059050)

The "savings account" wallet should be backed up in encrypted form only and all plaintext copies of this wallet should be erased. In case someone gains unauthorised access to your computer (either by physically stealing it or by exploiting a system vulnerability via the internet), they will only be able to spend the coins in your "current account" wallet."

I can't think of any other currency where forgetting the password to your bank account actually causes you to irreversibly lose the money contained therein...

Re:Yes but (1)

killkillkill (884238) | more than 2 years ago | (#38058396)

All it takes is one rogue hacker to misdirect bitcoin payments and you have instant skimming

I don't think you know how bitcoin transaction work. On a compromised computer, sure, a hacker can steal your wallet an your bitcoins are gone. I don't believe there are any (known or theoretical) realistic ways to screw with transaction in the network, though. Theft has been a big deal, clearly.Mostly it's been by or because of service operators that users shouldn't have trusted to begin with. The biggest theft involved online wallets. A service operated by an anonymous person who... surprise!... disappeared. The biggest problem with bitcoin is people dumping their money into something they had yet to have an understanding of.

Re:Yes but (1)

Bert64 (520050) | more than 2 years ago | (#38057918)

You also get instability with fiat currencies, just look at the Zimbabwe Dollar...
Currencies which are centrally controlled can trivially be devalued simply by the controller of that currency printing more money... The more they print, the lower value the remaining currency has.

The only disadvantage bitcoin currently has, is being relatively small so it requires considerably less resources to influence the market as a whole.

Re:Yes but (1)

tqft (619476) | more than 2 years ago | (#38058106)

"just look at the Zimbabwe Dollar..."
or the US dollar vs gold.

Question for those playing at home: at gold price in US dollars does the USA have assets greater than it's liabilities?

Re:Yes but (2)

Chrisq (894406) | more than 2 years ago | (#38057930)

With Bitcoin you can lose 30% of your money overnight.

Think of the Greeks you insensitive clod

Re:Yes but (1)

bmo (77928) | more than 2 years ago | (#38058246)

With Bitcoin you can lose all of your money overnight

Fixed.

--
BMO

Another flaw found in Bitcoin protocol (-1)

Anonymous Coward | more than 2 years ago | (#38057712)

The first flaw in Bitcoin is that alchemy does not work. Trying to turn lead and tin (as in circuit solder) into gold simply does not work. Following written or programmed recipes for "transmutation" of base material into gold get you nowhere. It really doesn't matter if you chant or the CPU/GPU runs these verses of transmutation, nothing will happen to lead and the electrons it conducts.

Therefore Bitcoin is a scam and the real gold some people get out of it is coming straight from other gullible people's pockets, it is not created. Bitcoin will collapse just like any other pyramid or Ponzi scheme.

People cannot gain anything without sacrificing something. You must present something of equal value in order to gain something. That is the principle of equivalent exchange in alchemy. "In the early days, we believed that to be the one truth in the world." - Alphonse Elric

Re:Another flaw found in currency (1)

Anonymous Coward | more than 2 years ago | (#38057766)

Change "lead and tin" to "ink and rag paper" and see how that argument works out for ya.

Re:Another flaw found in Bitcoin protocol (4, Interesting)

Bert64 (520050) | more than 2 years ago | (#38057970)

The value of a good is actually whatever a third party is willing to give you in exchange for that good... This value is completely arbitrary, and allows products with no physical value (eg software) to be sold for huge amounts of money or other goods...

Similarly, money itself has no real value, only the value that others are willing to give in exchange for it.

The advantage of bitcoin, is that while its effectively a worthless token system, just like regular cash, it is a finite supply and thus not subject to the whims of a central authority.

Personally i use bitcoin a lot, primarily as an intermediary currency because i can buy bitcoins with money i hold in one currency, and then draw it out again in my local currency without incurring fees levied by existing currency exchange establishments.

Re:Another flaw found in Bitcoin protocol (-1)

Anonymous Coward | more than 2 years ago | (#38058550)

Yeah and avoid that pesky taxman, eh? It's pretty obvious that buttcoins are primarily used for petty money laundering LOL.

Re:Another flaw found in Bitcoin protocol (1)

Issarlk (1429361) | more than 2 years ago | (#38058004)

You can't eat gold. You can't use it to make tools to work the fields or cut trees (too soft and too rare). And yet people used little bits of gold to trade goods. Why?
This is truly a mystery.

Re:Another flaw found in Bitcoin protocol (1)

benjamindees (441808) | more than 2 years ago | (#38058936)

It's no mystery. Gold is limited in quantity. It is difficult to forge. It does not degrade over time. And it requires work to acquire.

As much as anything, trading is about forming relationships. It is about acceding to risk. It is about placing resources in the hands of others, in which we trust they will be well used and cared for. Look at the evolution of currency from simple barter, into our current system, one of credit and accounting standards in which reputation is paramount yet fraud is omnipresent.

Currency does not need to have inherent value. The value of a currency is in the people who use it, in the value produced by specialization and trade, and in the avoidance of risk while doing so. The value of Bitcoin lies in it's ability to help identify trading partners of similar calibre, with similar values, and to weed out the rest.

Burning GPU time is equivalent to burning $100 bills.

Irresponisble headline (5, Informative)

Anonymous Coward | more than 2 years ago | (#38057722)

Only a small fraction of bitcoin nodes (e.g. 1%) are mining nodes, and they all relay transactions as relaying transactions is very cheap to do. The problem they're describing clearly does not exist. If it did someday turn out to be an issue you can address it by users handing their transactions directly to various miners, you don't need some crazy complicated reward scheme.

It's also not news— their contribution isn't insight on incentives but a complicated sibyl resistant reward scheme for trees (which the bitcoin network is not) which requires doubling the cost of forwarding a transaction every two hops it takes. (By making every node perform a great many additional cryptographic signatures and checks in order to track the reward)

Re:Irresponisble headline (1)

makomk (752139) | more than 2 years ago | (#38058932)

Only a small fraction of bitcoin nodes (e.g. 1%) are mining nodes, and they all relay transactions as relaying transactions is very cheap to do.

The problem is what happens if relaying transactions becomes less cheap - that is to say, if Bitcoin actually gets adopted and the transaction volume skyrockets.

And what's the Bitcoin Forums response? (0, Flamebait)

David Gerard (12369) | more than 2 years ago | (#38057734)

And what's the Bitcoin Forums response? Denial [bitcointalk.org] .

Re:And what's the Bitcoin Forums response? (5, Insightful)

Anonymous Coward | more than 2 years ago | (#38057904)

when you wrote "denial" did you mean "in a discussion involving several dozen people, one participant denied the existence of the problem while everyone else discussed whether the flaw is a practical problem or how it could be solved"?

Understandable typo, the keys are right next to each other.

Re:And what's the Bitcoin Forums response? (3, Informative)

Halo1 (136547) | more than 2 years ago | (#38057916)

Not to mention "engaging in a constructive discussion with one of the original authors of the paper, who hopped in and thanked people for their interesting comments".

Mod parent up.

Re:And what's the Bitcoin Forums response? (2)

IamTheRealMike (537420) | more than 2 years ago | (#38058058)

Yeah, hardly denial. Let me post my response to the thread here to make it more visible. The summary is that this is not a new argument, but the MSR researchers certainly went deeper into it than most people do. Long term broadcast/floodfill is likely to become less important for other reasons beyond nodes deciding not to relay (which is not a problem observed in practice).

This point has been discussed on the forum several times over the last couple of years. It's not a novel criticism though I'm glad the smart people at MSR are taking a hard look at Bitcoin. Hopefully they may see this thread and jump in with their thoughts.

Note that it's not just miners who have an incentive to not relay transactions. In theory, you could run a non-mining node that co-operates with a mining node. When you receive a transaction with a fee, you send it directly to the mining node and no others, in return for a small cut of the profits. It's unlikely to happen for a long time (if ever), as currently you could argue there's actually no incentive to include transactions at all - yet people still do.

I agree with Gregory, transaction broadcast is a simple and useful technique in the early days of the network, but if Bitcoin continues to grow and evolve we'll see a move away from it - it's often unnecessary, inefficient and has some strange incentive structures like the paper says. I'm not sure trying to fix it is the right approach.

What would replace it? I've argued in the past that senders should never attach fees because they aren't the one who actually cares about payment confirmation (they know they are trustworthy). Instead senders should send a free transaction directly to the receiver. They can then decide what to do with it - attach a fee (2nd tx) and broadcast, upload it directly to miners, or if you have high confidence in the sender to not double spend simply keep it around and pass it on to somebody else as part of a new payment.

Stefan has argued for an insurance company scheme in which merchants protect themselves against the risk of double spending by paying small premiums. In this setup, the receiver would have another option - transmit the received transaction straight to the insurance company. They'd verify it was valid and broadcast it in such a way that as many miners as possible are likely to receive it. Miners have incentives to connect directly to the insurance company nodes (or intermediate backbone nodes) and the insurance companies have incentives to make it easy for them. Broadcast over 10,000 connections really isn't a big deal for modern computers so I'm not worried about this kind of scalability.

Of course, this takes us a little bit further from the purist "zero trust" design that Satoshi was aiming for. Starting a new insurance company would (in the absence of functioning broadcast) be harder because you'd have to find all the miners. That doesn't worry me much - the long term future of mining is as a professional business, it's already gone that way to some extent, and all the incentives are aligned. Miners have an incentive to be visible and merchants/insurers have an incentive to seek them out. Whether that's done via a naive P2P broadcast or something more sophisticated, only time will tell.

Re:And what's the Bitcoin Forums response? (0, Troll)

drinkypoo (153816) | more than 2 years ago | (#38057908)

If people stop mining bitcoins now, the people at the top will stop winning, so of course they are going to deny. You know, kind of like global warming.

Re:And what's the Bitcoin Forums response? (5, Funny)

serviscope_minor (664417) | more than 2 years ago | (#38058140)

If people stop mining bitcoins now, the people at the top will stop winning, so of course they are going to deny. You know, kind of like global warming

A bad analogy is like a leaky screwdriver and that analogy has covered the floor in so much water that it is like a really tricky crossword puzzle.

Re:And what's the Bitcoin Forums response? (0)

drinkypoo (153816) | more than 2 years ago | (#38058194)

The people profiting from the human activities which everyone who has an opinion that matters agrees are at minimum exacerbating global warming and which are probably capable of being entirely responsible, especially the massive CO2 emissions which are unprecedented throughout the history of the globe being able to support our existence, would have to hold their bellies in if they were to laugh hard enough at you to match the hilarity of what you've just said.

Re:And what's the Bitcoin Forums response? (1)

Rogerborg (306625) | more than 2 years ago | (#38057954)

The take-away from that discussion is that the number of nodes on the bitcoin network is "dropping and has been for some time". Bitcoin is already dead, we're just waiting for Netcraft to confirm it and a politician to deny it.

Re:And what's the Bitcoin Forums response? (2)

mgiuca (1040724) | more than 2 years ago | (#38058622)

I think the best response on there is this:

"I suppose this argument would be equivalent to saying in BitTorrent, that there is "no incentive" for people to seed files, therefore, eventually nobody will seed files and that BitTorrent will soon fail."

As far as I can tell, the argument is this:
1. Miners win transaction fees when they a) receive a transaction, and b) solve a block with that transaction in it.
2. If other miners don't know about a transaction, they cannot win the transaction fee.
3. Miners are therefore incentivised to not tell other people about the transactions they hear about.
4. Therefore, the network will break as miners stop forwarding transactions.

This argument has some significant flaws:
1. It isn't just miners who forward transactions -- it's all nodes. As the quote above suggests, there is no incentive for non-miner nodes (which massively outnumber the miner nodes) to not forward a transaction, except bandwidth costs. And that doesn't seem to have stopped BitTorrent users.
2. For this scheme (not forwarding) to pay off, miners would have to somehow prevent all other nodes from receiving the transactions. Transactions are propagating around the network via all the nodes, so each transaction could find hundreds of paths to each node. A miner would have to block of all paths to all of the competing miners for this attack to be effective.

For this to be effective, it would need the majority of nodes on the network to be "selfish" (including non-miner nodes). Remember, the whole Bitcoin network already relies on the fact that the majority of nodes are "good" nodes (for verification purposes). So there is no point speculating about a possible future Bitcoin network in which an overwhelming majority of nodes collude together to prevent other nodes receiving transactions.

Re:And what's the Bitcoin Forums response? (1)

makomk (752139) | more than 2 years ago | (#38058966)

See the comments in the thread. In particular, (a) there's a limit to the number of fee-free transactions in a block, and once we start hitting that limit it makes sense for nodes to delay other people's transactions by not forwarding them, and (b) it's possible for miners to incentivise other nodes not to forward transactions with big fees to anyone else.

summary (5, Insightful)

petermgreen (876956) | more than 2 years ago | (#38057746)

If a LARGE proportion of bitcoin nodes are run by assholes who refuse to distribute transactions then the network may fall apart.

This system seems to add a lot of complexity to solve something that has not proven a problem.

All of my mod points will be undone now, but.. (3, Interesting)

intellitech (1912116) | more than 2 years ago | (#38057892)

A bug can exist without it immediately causing problems. It's generally best to fix things before they become a problem, not afterwards.

Re:All of my mod points will be undone now, but.. (3, Funny)

Ginger Unicorn (952287) | more than 2 years ago | (#38058270)

which is ironic considering this is coming from microsoft

Re:All of my mod points will be undone now, but.. (1)

petermgreen (876956) | more than 2 years ago | (#38058608)

True but equally the cost of a fix must be weighed against the benefit of that fix. This "fix" seems to be high cost (dramatically increasing the cost of forwarding a block) for dubious benefit.

Even if the asshole density got to high for transactions to propogate through random public connections i'm sure people would form other arragenements for getting transactions to miners.

The researchers haven't even made it clear (at least from my reading of the paper, please tell me if I missed something) if they think this complex system can be implemented without changing the blockchain system to accomodate the new transactions with pre-ordained fee split.

Re:summary (1)

ultranova (717540) | more than 2 years ago | (#38058378)

This system seems to add a lot of complexity to solve something that has not proven a problem.

No, this system adds a lot of complexity to tie every transaction to an IP address. The goal is surveillance, the stated purpose is just a thinly veiled excuse.

Re:summary (0)

Anonymous Coward | more than 2 years ago | (#38058452)

"Something that has not proven a problem?"

really? that's security, now?

consider this: with the rise of bitcoin malware, there may be more zombie computers running bitcoin without the user's knowledge, than there are actual intentional users.

Re:summary (1)

jduhls (1666325) | more than 2 years ago | (#38059108)

yeah, it's like the early interwebs: each node is populated by a troll.

Ayn Rand (0, Offtopic)

Anonymous Coward | more than 2 years ago | (#38057750)

Can someone tell my why I've had Ayn Rand shoved down my throat 3 times in the past few hours online?

There has to be some kookey Anon C who can map out the coarser details of her connection to the Illuminati for me.

Please do. Thanks.

Doesn't really make sense (3, Interesting)

Anonymous Coward | more than 2 years ago | (#38057758)

This doesn't really make sense. Clients forward transactions as well as miners (and typical clients are connected to 8 other clients, making it a very well connected network).

Granted, there is no incentive to forward transactions, but if nobody forwards transactions then the network won't work so ultimately it's in the self interest of all users to do so. Some miners may decide not to do so, in the hope that they will be the one who solves the block and get the transaction fee. But they are not actually gaining anything by doing so. They are making other miners potentially miss out on transaction fees but it doesn't improve their chances of winning the block and therefore getting the fee and there is no way they can know what transactions other miners have picked up through other routes via the network.

I think the conclusion is wrong; while there is no incentive to forward the transaction (beyond stability of the network), there is also no obvious disincentive to do so as the cost is tiny (the cost of the bandwidth to forward it)

Re:Doesn't really make sense (2)

kiddygrinder (605598) | more than 2 years ago | (#38057814)

sounds like the same awesome plan as sitting on a poker machine.

Re:Doesn't really make sense (3, Informative)

drinkypoo (153816) | more than 2 years ago | (#38057932)

They are making other miners potentially miss out on transaction fees but it doesn't improve their chances of winning the block and therefore getting the fee and there is no way they can know what transactions other miners have picked up through other routes via the network.

If it hurts the other guy and it doesn't hurt you then there is an incentive not to forward any more transactions than you have to. If it hurts you and other guy at the same time then you can do it selectively, any time it will hurt him more. If everyone were altruistic, you'd be right. They aren't, so you aren't.

Re:Doesn't really make sense (2)

IamTheRealMike (537420) | more than 2 years ago | (#38058144)

It's not about altruism, it's about longer term incentives. If Bitcoin fails to work properly because people hoard transactions then the worth of your own Bitcoin using business and stored value goes down.

There are plenty of other responses possible to this problem though, if it ever actually happens (nobody has observed people failing to relay transactions for profit today). One is to simply have rebroadcast nodes that don't verify transactions or blocks and thus are very cheap to run, which simply ensure good broadcast connectivity. Another is to accept that people, merchants in particular, have an incentive to get their transactions to as many miners as possible, and miners have incentives to get transactions, so it's very likely these people will find each other some way without relying on broadcast. Nothing in Bitcoin actually requires P2P broadcast of transactions, it's just convenient.

Re:Doesn't really make sense (2)

drinkypoo (153816) | more than 2 years ago | (#38058202)

I didn't say it couldn't be solved, I said there are incentives to behave in this fashion, and therefore it is a flaw in the implementation of bitcoin, but a much smaller one than that bitcoins represent waste instead of production or wealth.

Re:Doesn't really make sense (1)

heathen_01 (1191043) | more than 2 years ago | (#38058584)

... than that bitcoins represent waste instead of production or wealth.

I don't understand your point. How do traditional notes/coins represent production and wealth instead of waste. There is no intrinsic value in the notes I currently hold, there is only value in the idea that I can swap it for something else.

Re:Doesn't really make sense (2)

History's Coming To (1059484) | more than 2 years ago | (#38058138)

A big part of the problem is likely to be people like me who started playing around with Bitcoin out of curiosity and then just gave up because I didn't really care and couldn't see the point. I suspect there's a lot of people like me, and hence a lot of "dead nodes" in the system.

Re:Doesn't really make sense (1)

Rogerborg (306625) | more than 2 years ago | (#38058542)

Even the bitcoin true believers on their forums have admitted that the number of nodes is dropping. The total "market value" of all the bitcoins in existence is essentially insignificant and designed to stay that way. You'd (seriously) be better off posting baggies of gold dust around if you want a universal, untraceable currency.

Re:Doesn't really make sense (1)

makomk (752139) | more than 2 years ago | (#38058984)

Actually, for various reasons Bitcoin appears to be quite badly connected. Pools have seen block propagation times across the networks of over a minute, and I don't think anyone's even bothered to measure transaction propagation because it doesn't currently matter much to the miners.

http://www.ustream.tv/theother99 (-1)

Anonymous Coward | more than 2 years ago | (#38057784)

our freedom disappears whilst we count the ?change? none of US really has.

jjhhj (-1)

Anonymous Coward | more than 2 years ago | (#38057914)

bjhjkjh

I don't like this one bit (2)

mutherhacker (638199) | more than 2 years ago | (#38057950)

So we need some new method or entity to help move bitcoin from one place to another? Perhaps something like.. banks and insurance companies and derivatives etc? I don't like where this is headed :)

How much ...? (-1)

Anonymous Coward | more than 2 years ago | (#38058134)

How much is slashdot getting paid to run bitcoin ads?

(Hint: There is no such thing as bad publicity.)

Grabbing some popcorn (1, Interesting)

Dunbal (464142) | more than 2 years ago | (#38058210)

Getting ready to watch bitcoin plunge the rest of the way to zero. Just over $2 now. Anyone who lost money in bitcoin must be told : "seriously, what were you thinking?"

Re:Grabbing some popcorn (1)

Ragondux (2034126) | more than 2 years ago | (#38058344)

Just over $2 now? Last year, when I got some bitcoins, they were all discussing when they'd reach dollar parity, so $2 for 1 BTC is still a good deal. Sure, they had a short bubble recently, but $2 is only low relative to that bubble, not to the evolution of bitcoin.

Re:Grabbing some popcorn (1)

Rogerborg (306625) | more than 2 years ago | (#38058498)

I'm sure that some early speculators have cashed out and doubled their money. Why, some of them are literally tenionaires now.

Re:Grabbing some popcorn (0)

Anonymous Coward | more than 2 years ago | (#38058676)

Those who lost money in bitcoin only lost because other won. Their money didn't vanish, it went to someone else, so, what about all those who won?

right... (-1)

Anonymous Coward | more than 2 years ago | (#38058284)

Typical Microsoft. Create a problem then infiltrate. They must have found a value proposition. Sort of like the USA government bringing "democracy and freedom" to people whenever there are natural resources for their corporate masters to exploit. Fortunately software is still a meritocracy and Microsoft generally sucks.

Ludicrous (2)

mathimus1863 (1120437) | more than 2 years ago | (#38058342)

Shame on you slashdot. This is a disgustingly misleading headline that has absolutely nothing to do with the paper. The paper is only offering recommendations for the future, based on some incorrect assumptions about the network (which is that there will be difficulty in propagating transactions). This is not a "flaw" in the protocol.

The Bitcoin network is well-connected and the only nodes that have incentive not to forward txs make up a tiny percentage of the network (less than 1%). Even if they were the only nodes on the network, the network is designed so that users can locate them, and it costs nothing for a user to forward their transaction to many/all of them. This is completely a non-issue.

this F7P for GNAA (-1)

Anonymous Coward | more than 2 years ago | (#38058530)

mo3 0p (-1)

Anonymous Coward | more than 2 years ago | (#38058706)

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