Author Topic: The reverse acquisition attack: Buying the bitcoin POW to DPOS hardfork  (Read 12805 times)

0 Members and 1 Guest are viewing this topic.

Offline fluxer555

  • Hero Member
  • *****
  • Posts: 749
    • View Profile
Next question: How is this different than the big miners participating in the merged mining of an alt coin?

Merged miners are not incentivized to exclude BTC transactions.

Offline xeroc

  • Board Moderator
  • Hero Member
  • *****
  • Posts: 12922
  • ChainSquad GmbH
    • View Profile
    • ChainSquad GmbH
  • BitShares: xeroc
  • GitHub: xeroc
also:

- the community has the capailities to setup an own mining pool that might end up in 51% mining power because we can pay WAY more to the miners. This way we can also proof the basic flaws of POW


Offline Riverhead

Next question: How is this different than the big miners participating in the merged mining of an alt coin?

Also:


Offline xeroc

  • Board Moderator
  • Hero Member
  • *****
  • Posts: 12922
  • ChainSquad GmbH
    • View Profile
    • ChainSquad GmbH
  • BitShares: xeroc
  • GitHub: xeroc
First of all: This is an AWESOME idea.
Let me add some remarks:

- What you are doing is basically an airdrop on BTC addresses. There is no need to reveal the private keys of btc addresses. you can initialize all BTC addresses on the BTS chain using a corresponding BTS address for the private key .. so users import their keys and see the very same btc in their accounts. no revealing required

- we might even find a way to circumvent the EXODUS block and have an even smoother transition of funds, such that, the miners of ERBs are also taking a look into the BTS address balances and perform those transactions on both chains. If you haven't listened to the latest hangout you should do so. BM talks about the issue of stock issued on the blockchain and that the issuer needs to be able to withdraw from every owner. So in theroy, we can add the keys of the miners to the bitcoin "asset" on BTS and allow them (multi-sig) to withdraw funds from the corresponding btc addresses in the BTS chain, too. If the balance does not allow that in the BTS chain.. then the bitcoin transaction is not included into the ERBs.
You get what I am talking about? Single drawback is that those transactions in the BTS chain should require a third party to watch both chains and also sign those transactions, else miners could mess with the balances at will.

- a side effect of this is that we also kill counterparty and mastercoin :)

Offline Rune

  • Hero Member
  • *****
  • Posts: 1120
    • View Profile
I'm now mostly concerned for the safety of the BitShares dev team from irrational, crazy bitcoiners...

IMO the bitshares dev team should have nothing to do with this, I guess also partially for their safety. They are busy improving the bitshares client and shouldn't have to deal with the shitstorm. To ensure that bitcoiners feel safe then once that it is becoming clear to everyone that the migration is going to happen, we can hire a prominent bitcoin developer to make the new genesis block. So it will be someone like andreas antonopolous or gavin who makes the genesis block and puts it up for bitshares stakeholders to vote for, so that bitcoiners will be more likely to trust that the social contract will be honored. Some of them might ragequit from blockchain tech permanently, but I'm sure it will be possible to find a trusted bitcoin community member who will be willing to help facilitate a smooth acquisition.

Formulating the social contract is actually all that is needed for the execution of the reverse acquisition, and then eventually making the new genesis block, so it will be something that our community of stakeholders and the bitcoin community can do autonomously and with relative ease.
« Last Edit: November 12, 2014, 05:37:48 pm by Rune »

Offline Rune

  • Hero Member
  • *****
  • Posts: 1120
    • View Profile

Only flaw I can see, and I may have missed it somewhere in the Wall-O-Text is:

Would the migration from POW to DPOS of the miners need to happen in a shorter time frame than the diff adjustment? Otherwise each major miner that started to mine ERB's instead would be making mining more profitable for whoever is left because the diff would start to nose dive. Then you'd have an uptick in the number of miners and the cycle continues.

ERB's will be on the main bitcoin blockchain at full difficulty. The idea will be to keep the bitcoin difficulty at its current levels, even long after the migration is over, so that once it has happened it will be impossible for anyone to process transactions on the bitcoin blockchain (after the new genesis block miners will only get external rewards for their bitcoin blocks if they mine on top of other empty blocks, so any future bitcoin block with a transaction in it will be rejected by the network and orphaned. Once it has been established that the only reward you get for mining bitcoin blocks are now rewards on the bitshares blockchain, and the new bitcoins themselves are completely worthless because they cannot be moved, then we can begin to gradually lower the difficulty to a level that actually makes sense (by reducing rewards), and use the bitcoin blockchain as a POW backup to determine the correct bitshares main chain (through embedded hashes).

Offline fluxer555

  • Hero Member
  • *****
  • Posts: 749
    • View Profile
I'm now mostly concerned for the safety of the BitShares dev team from irrational, crazy bitcoiners...

Offline fluxer555

  • Hero Member
  • *****
  • Posts: 749
    • View Profile

Offline Rune

  • Hero Member
  • *****
  • Posts: 1120
    • View Profile
I wonder at what lengths Bitcoiners would do to stop pools that are mining ERBs.

This will also inevitably put us at war with Bitcoin, especially if this fails. We may see much more transaction spamming, DDoS, new exploits, etc. from Bitcoin Zealots. The resulting climate of the combined effect of these attacks on BTS with the hostile takeover of BTC will be very hard to predict...

I've already thought about this, and my initial conclusion is that there is nothing a bitcoin holder can do beyond normal internet shitstorms. I believe their initial reaction will be to simply dismiss that this can possibly happen, and the anger will not come until it is already obvious that the acquisition cannot be prevented. At that point if they wish to continue holding bitcoins then they will be hurting their own investment by attacking bitshares.

There is no doubt that the price of both bitcoin and bitshares would become wildly volatile once ERB's begin to be mined. You'll have tons of people, prominent community members even, publicly pledging that they are permanently done with bitcoin and blockchains, like when oculus got bought out. You'll have institutional investors claiming they are running away in fear (while secretly buying). I think the futility of the situation and the undeniable reality that this is an inherent POW flaw will eventually force people to calm down. They will realize that even if we moved to do a reverse acquisition and failed due to too much resistance, someone else would simply come along right after and would offer 10 times the ERB rewards to the miners to ensure a swift transition. In fact we in bitshares could simply vote to change our social contract to something with higher ERB rewards if we feel like the bitcoiners are being too resistant - this would hurt the bitcoiners more by having their share diluted more, and would incentivize them to take the path of most stability to avoid having it ever brought on the table: unconditionally supporting the acquisition.

Once the initial shitstorms begin to calm down we will see people beginning to learn the advantages bitshares has (now that they're suddenly on track to be stakeholders in it), and their grand vision of a single, unified blockchain holding all blockchain functions will be realized. I think the idea of a super-blockchain is actually pretty easy to sell to the bitcoiners, especially when it is a fait accompli. When the dust settles I'm sure that bitcoin/bitshares will begin an instant new 10x bubble due to the possibilities of the bitshares technology and the unification of all developers as delegates.

But yeah, it's going to be pretty crazy.

Offline Riverhead


Only flaw I can see, and I may have missed it somewhere in the Wall-O-Text is:

Would the migration from POW to DPOS of the miners need to happen in a shorter time frame than the diff adjustment? Otherwise each major miner that started to mine ERB's instead would be making mining more profitable for whoever is left because the diff would start to nose dive. Then you'd have an uptick in the number of miners and the cycle continues.


Offline Rune

  • Hero Member
  • *****
  • Posts: 1120
    • View Profile
Rune, you crazy guy, this looks like a very clever idea, but my gut tells me it would never work. I'll see if I can convince my gut to tell me why it's so pessimistic, but first a question: When a mining pool publishes an ERB, do they collect the normal bitcoin block reward for it as well as the future reward they get at exodus?

I think that would be a bad idea, as that could allow for the selling on of ERB's and would perhaps make it less obvious when the bitcoin blockchain is ready for the exodus (when every other block is an ERB). If miners are forced to hold onto the normal bitcoins in the ERB if they want to collect the bonus bitcoins post-exodus it will make them more vested into seeing the exodus go through, I think. I'm not sure if it really matters though.

The way I see it would work is this: When the bitcoin network stops and the new genesis block is created, the developers who make it basically manually go through a list of all ERB's they can detect that fulfill the rules of the social contract (no transactions, the word "bitshares" embedded into it). If the 25 bitcoins still sit in the same address as when the block was mined, they are manually changed to x times as many, creating the bonus bitcoins out of thin air and allowing the miners to claim them just like they claim all their other post-exodus bitcoins.

I guess the  we would vote the new genesis block into effect, we will all attempt to go through the block and make sure everything is according to the social contract, so that the transition is as smooth as possible with no errors (any error would cost us dearly, and would mean we would have to be very careful). It's possible that we would have to have the bitcoin network shut down for at least 24 hours just to be totally sure that everything is as it should be, before we vote the genesis block into effect. During this time exchanges would still work, and anyone needing to do blockchain transactions would have already moved over to bitshares as it would continue to function normally. Hodlers wouldn't need to do anything though, they could just wait for the exodus to happen and claim their new bitcoins whenever they need them. In case the new genesis block is wrong and isn't accepted by the miners, or is too slow, they would resume processing transactions on the bitcoin network and the exodus would fail, so we will have to be swift and effective. A failed exodus would hurt bitcoin a lot more than it would hurt bitshares, so there is no chance this will be used as some angle of attack - if the exodus is about to happen then the bitshares market cap will already be at 1 billion USD.

Offline fluxer555

  • Hero Member
  • *****
  • Posts: 749
    • View Profile
I wonder at what lengths Bitcoiners would do to stop pools that are mining ERBs.

This will also inevitably put us at war with Bitcoin, especially if this fails. We may see much more transaction spamming, DDoS, new exploits, etc. from Bitcoin Zealots. The resulting climate of the combined effect of these attacks on BTS with the hostile takeover of BTC will be very hard to predict...

Offline Ben Mason

  • Hero Member
  • *****
  • Posts: 1070
  • Integrity & Innovation, powered by Bitshares
    • View Profile
  • BitShares: benjojo

Offline biophil

  • Hero Member
  • *****
  • Posts: 880
  • Professor of Computer Science
    • View Profile
    • My Academic Website
  • BitShares: biophil
Rune, you crazy guy, this looks like a very clever idea, but my gut tells me it would never work. I'll see if I can convince my gut to tell me why it's so pessimistic, but first a question: When a mining pool publishes an ERB, do they collect the normal bitcoin block reward for it as well as the future reward they get at exodus?
Support our research efforts to improve BitAsset price-pegging! Vote for worker 1.14.204 "201907-uccs-research-project."