Abstract
Bitcoin has a number of features and properties which are sometimes presented as interesting and positive. In fact they are closer to engineering mistakes. Serious problems are programmed in the DNA (the source code) of great majority of crypto currencies. Small details in the source code can make very big difference. In this chapter seven major ‘sins’ of Bitcoin are discussed highlighting risks and suggesting solutions.
His blog covering crypto currency technology is blog.bettercrypto.com.
This is a preview of subscription content, log in via an institution to check access.
Access this chapter
Tax calculation will be finalised at checkout
Purchases are for personal use only
Notes
- 1.
They explain that the exact scenario is when he "controls more than 50 % of the network’s computing power" and they make it clear it can be temporary: "for the time that he is in control". However almost to make things worse again, this official wiki at numerous places refers to another article about Bitcoin attacks written for more general audience (Perry 2012) which again claims that 51 % attacks are “so amazingly cost-prohibitive to perform”.
- 2.
This decision also has definitely infringed on the initial intentions of Satoshi explicitly stated in Sect. 6 of his paper (Nakamoto 2008) where he explains that the fact that a block provides a monetary reward for the “creator of the block” is something which "adds an incentive for nodes to support the network". This incentive is now broken.
- 3.
In contrast Satoshi have claimed that he always has such an option, in Sect. 6 of Nakamoto (2008) we read: “he would have to choose between using it to defraud people by stealing back his payments, or using it to generate new coins.”
References
Anderson, R.: Open and closed systems are equivalent (that is, in an ideal world). In: Perspectives on Free and Open Source Software, pp. 127–142. MIT Press (2005)
Andreas, M.: Antonopoulos: speaking at L.A. Bitcoin Meetup (2014). https://www.youtube.com/watch?v=bTPQKyAq-DMfeature=youtu.bet=49m20s. Accessed 9 Jan 2014
Antonopoulos, A.: Mastering Bitcoin, Unlocking Digital Cryptocurrencies, Book, 298 pp. O’Reilly Media, ISBN 978-1-4493-7404-4
Barber, S., Boyen, X., Shi, E., Uzun, E.: Bitter to better: how to make Bitcoin a better currency. In: Financial Cryptography and Data Security, FC’12. Springer (2012)
Bernstein, D.J., Lange, T.: SafeCurves: choosing safe curves for elliptic-curve cryptography, Discriminants sub-page.http://safecurves.cr.yp.to/disc.html. Accessed 4 Sept 2014
Bitcoin Forum, Topic: NSA and ECC, cf. https://bitcointalk.org/index.php?topic=289795.80
Bitcoin “Myths” page, part of official bitcoin wiki. https://en.bitcoin.it/wiki/Myths#Bitcoins_are_worthless_because_they.27re_based_on_unproven_cryptography
Cawrey, D.: What Are Bitcoin Nodes and Why Do We Need Them? 9 May 2014. http://www.coindesk.com/bitcoin-nodes-need/
Cawrey, D.: Are 51 % Attacks a Real Threat to Bitcoin? http://www.coindesk.com/51-attacks-real-threat-bitcoin/
Courtois, N.T.: Computer security foundations and principles. In: Extended Version of Slides from COMPGA01 Computer Security 1 taught at UCL in 2009–2013. http://www.nicolascourtois.com/papers/compsec/CompSec_Intro_01_long.ppt
Courtois, N.T.: On The Longest Chain Rule and Programmed Self-Destruction of Crypto Currencies, 20 May 2014 (2014). http://arxiv.org/abs/1405.0534. Accessed 10 Dec 2014
Courtois, N.T., Emirdag, P., Nagy, D.A.: Could Bitcoin Transactions Be 100x Faster? In: Post-proceedings of SECRYPT 2014, 28–30 August 2014, Vienna, Austria (2014a). http://www.nicolascourtois.com/bitcoin/POSTER_100x_Secrypt2014_v1.0.pdf
Courtois, N.T., Emirdag, P., Wang, Z.: On Detection of Bitcoin mining redirection attacks. In: ICISSP 2015, 1st International Conference on Information Systems Security and Privacy, 9–11 Feb 2015, Angers, France (2014b)
Courtois, N.T., Grajek, M., Bahack, L.: On Subversive Miner Strategies and Block Withholding Attack in Bitcoin Digital Currency, 1em plus 0.5em minus 0.4em (2014c). http://arxiv.org/abs/1402.1718. Accessed 28 Jan 2014
Courtois, N.T., Grajek, M., Naik, R.: Optimizing SHA256 in Bitcoin Mining. In: Proceedings of CSS 2014. Springer CCIS series Proceedings (2014d). http://link.springer.com/chapter/10.1007/978-3-662-44893-9_12
Courtois, N.T., Grajek, M., Naik, R.: The Unreasonable Fundamental Incertitudes Behind Bitcoin Mining. 1em plus 0.5em minus 0.4em (2013). http://arxiv.org/abs/1310.7935. Accessed 31 Oct 2013
Decker, C.: Wattenhofer, R.: Bitcoin Transaction Malleability and MtGox. 1em plus 0.5em minus 0.4em (2014) http://arxiv.org/pdf/1403.6676.pdf
Felten, E.: Bitcoin Mining Now Dominated by One Pool. https://freedom-to-tinker.com/blog/felten/bitcoin-mining-now-dominated-by-one-pool/. Accessed 16 June 2014
Financial Times Videos: two excerpts from an interview with Dr Nicolas Courtois of UCL on Bitcoin: http://video.ft.com/3667480923001/Camp-Alphaville-on-cashless-society/Editors-Choice. Accessed 2 July 2014
Galbraith, S.D., Smart, N.P.: Evaluation Report for CRYPTREC: Security Level of Cryptography—ECDLP Mathematical Problem. http://www.ipa.go.jp/security/enc/CRYPTREC/fy15/doc/1029_report.pdf
Higgins, S.: Dogecoin to Allow Litecoin Merge Mining in Network Security bid. http://www.coindesk.com/dogecoin-allow-litecoin-merge-mining/. Accessed 4 Aug 2014
Koblitz, N.: The uneasy relationship between mathematics and cryptography. In: Notices of the American Mathematical. Society. http://www.ams.org/notices/200708/tx070800972p.pdf
Kerckhoffs, A.: La cryptographie militaire. Journal des Sciences Militaires IX, 5–38, 161–191(1883). http://www.petitcolas.net/fabien/kerckhoffs/
Kroll, J.A., Davey, I.C., Felten, E.W.: The Economics of Bitcoin Mining, or Bitcoin in the Presence of Adversaries. In: WEIS 2013, Washington, DC. http://weis2013.econinfosec.org/papers/KrollDaveyFeltenWEIS2013.pdf. Accessed 11–12 June 2013
Lee Kuo Chuen, D. (ed.): Handbook of Digital Currency, 1st edn. Bitcoin, Innovation, Financial Instruments, and Big Data, 612 pp. Academic Press. Accessed 29 April 2015
Matthews, C.: Bit Con? Veteran fraud expert sets his sights on bitcoin. http://fortune.com/2014/10/24/bitcoin-fraud-scam/
Maese, V.A.: Divining the Regulatory Future of Illegitimate Cryptocurrencies. Wall Street Lawyer 18(5)
Marek (slush) Palatinus: Stratum mining protocol. The official documentation of lightweight bitcoin mining protocol (2014). https://mining.bitcoin.cz/stratum-mining. A compact thrid-party description can also be found at https://www.btcguild.com/new_protocol.php
Mining digital gold, from the print edition: finance and economics. The Economist, 13 April 2013
Nakamoto, S.: Bitcoin: A Peer-to-Peer Electronic Cash System (2008). http://bitcoin.org/bitcoin.pdf
Nakamoto, S., et al.: Bitcoin QT, the original and the most prominent bitcoin software distribution which implements a full peer-to-peer network node. Originally developed by Satoshi Nakamoto, core developers are Satoshi Nakamoto, Gavin Andresen, Pieter Wuille, Nils Schneider, Jeff Garzik, Wladimir J. van der Laan and Gregory Maxwell. http://bitcoin.org/en/download with source code at https://github.com/bitcoin/bitcoin
Official Bitcoin Wiki: Weaknesses. Summary of all known weaknesses of bitcoin system (2014a). https://en.bitcoin.it/wiki/Weaknesses
Official Bitcoin Wiki: Double Spending. page dedicated to double spending threats and attacks (2014b). https://en.bitcoin.it/wiki/Double-spending
Perry, D.: Posted as GUEST: Bitcoin Attacks in Plain English. http://codinginmysleep.com/bitcoin-attacks-in-plain-english/. Accessed 5 Oct 2012
Rosenfeld, M.: Mining pools reward methods. Presentation at Bitcoin 2013 Conference. http://www.youtube.com/watch?v=5sgdD4mGPfg
Saltzer, J.H., Schroeder, M.D.: “The protection of information in computer systems.” In: Proceedings of the IEEE, 63(9), 1278–1308 (1975)
Sams, R.: The Marginal Cost of Cryptocurrency. Blog entry at cryptonomics.org. http://cryptonomics.org/2014/01/15/the-marginal-cost-of-cryptocurrency/
Swanson, T.: What Dogecoin Must Do to Survive. http://www.coindesk.com/what-dogecoin-must-do-survive/. Accessed 25 May 2014
Technical Specification of the Bitcoin Protocol: https://en.bitcoin.it/wiki/Protocol_specification
Todd, P.: Why I Just Sold 50 % of my Bitcoin: GHash.io. http://daytradernews.com/bitcoin-trading/why-i-just-sold-50-of-my-bitcoin-ghash-io.html. Accessed 13 June 2014
Wired Entreprise: http://www.wired.com/wiredenterprise/2013/11/bitcoin-and-deflation/all/. Accessed 25 Nov 2013
Wong, J.I.: Gavin Andresen Rejects Bitcoin Centralisation Concerns at Web Summit, 6 Nov 2014. http://www.coindesk.com/gavin-andresen-rejects-bitcoin-centralisation-concerns-web-summit/
Acknowledgments
We thank Xavier Alexandre, George Danezis, Gerald Davis, Pinar Emirdag, Michael Folkson, Clément Francomme, Pawel Krawczyk, Jean-Jacques Quisquater, Guangyan Song, Tim Swanson and John Shawe-Taylor for their extremely helpful suggestions, observations and comments.
Author information
Authors and Affiliations
Corresponding author
Editor information
Editors and Affiliations
Rights and permissions
Copyright information
© 2016 Springer International Publishing Switzerland
About this chapter
Cite this chapter
Courtois, N.T. (2016). Features or Bugs: The Seven Sins of Current Bitcoin. In: Tasca, P., Aste, T., Pelizzon, L., Perony, N. (eds) Banking Beyond Banks and Money. New Economic Windows. Springer, Cham. https://doi.org/10.1007/978-3-319-42448-4_6
Download citation
DOI: https://doi.org/10.1007/978-3-319-42448-4_6
Published:
Publisher Name: Springer, Cham
Print ISBN: 978-3-319-42446-0
Online ISBN: 978-3-319-42448-4
eBook Packages: Physics and AstronomyPhysics and Astronomy (R0)