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back to article Bitcopocalypse! Top crypto-currency can be HIJACKED, warn boffins

The Bitcoin crypto-currency is vulnerable to manipulation by greedy miners, researchers have claimed, which poses a threat to the stability of the funny money. In a paper distributed on Monday titled Majority is not Enough: Bitcoin Mining is Vulnerable, two researchers from Cornell University describe how Bitcoin's currency …

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Increasing difficulty of mining Bitcoin

With mining Bitcoins getting progressively more time consuming as the difficulty of finding them is logarithmic

see this difficulty chart: https://blockchain.info/charts/difficulty

it means there will (soon?) be a tipping point where it costs more money in electricity to mine them on a mass scale than it returns in Bitcoin value. That's when things could get interesting, with more people dropping out due to the unprofitability, will the big players dominate the market and achieve 33%?

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Re: Increasing difficulty of mining Bitcoin

You mean like monopoly, with little kids who control the bank, they cheat ?

Cost of electricity, Maybe thats why microsoft bought a Windfarm & Google barges are about, so they can mine bitcoin faster/cheaper ?

Bitcoins are a anarchists dream, Blood seems to be only currency to change who holds purse-strings, I am afraid .....

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Re: Increasing difficulty of mining Bitcoin

But unless you can buy electricity with Bitcoins then the tipping point is also determined by the exchange rate. If fewer coins are produced but demand stays high then the rate should rise, delaying or preventing the tipping point. Other events, such as US authorities taking Bitcoins out of circulation, should also help...

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Re: Increasing difficulty of mining Bitcoin

The difficulty reflects the amount of mining power automatically. Some people drop out when mining becomes unprofitable and the difficulty will re-adjust. Some people continue because they speculate on a price rise. BitCoin history shows that unprofitable mining in the past made huge profits because of the price rise.

It is true that the difficulty is so high that some forms of mining can never be profitable. But the price of replacing a graphics card with a block eruptor of the same power is £12 with a tiny 2watt power usage. So high performance is still within reach of the individual miner.

Although it's concerning I don't think this will happen.

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Re: Increasing difficulty of mining Bitcoin

Alternately, criminals use botnets so that they don't pay for the electricity.

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When it costs more in electricity to mine them than they are worth, won't the currency go tits up? Or will it just fall to botnets to mine coins as their leccy is free..

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Exactly. Of course botnets already are doing mining work, no honour amongst thieves etc., but it does make the legitimate bitcoin pool self limiting (in fact legit mining is probably already verging on unviable).

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Facepalm

Electricity is free is you steal it

Isn't a zombie botnet the most "efficient" way to mine bitcoins? So, very soon, mining will be dominated by a single gang of criminals, rather than multiple independent criminals.

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Re: Electricity is free is you steal it

I think the NSA gets free electricity.

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Re: Electricity is free is you steal it

Actually, CPU mining (even with a large botnet) is inefficient. Even GPU mining is no longer vaguely profitable due to ASICs (application specific integrated circuits) dedicated to bitcoin mining that only do one thing - mine bitcoins at speeds approaching hundreds of giga-hashes per second while using comparatively less electricity.

Unfortunately ASICs are being delivered by companies with less than stellar engineering abilities - companies like Butterfly Labs delivering products months late and massively under-spec; with bitcoin the bigger the network is, the less profit you realise - so much so that even ASICs will probably never break even once you take into consideration the massive initial investment and high electricity costs.

The punchline to the whole bitcoin joke is that is now virtually impossible to cash bitcoins out - the major exchanges are under investigation by various banks and regulatory authorities, MTGOX and others are estimating it will take years for them to give you your cash and the current 'best advice' for turning bitcoins into actual spendable money is to meet up with someone IRL and give them your bitcoins in return for paper money. The main market for actually spending bitcoin on physical product was the now defunct Silk Road, and the only other places accepting the cyber-currency online are experimental, dubious, or prone to disappearing overnight.

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Re: Electricity is free is you steal it

I think some like Coinbase are still around because they play above the board (Coinbase works WITH the banks). If the US comes calling for tax information, they'd probably provide it, keeping them in the clear. I used it to basically check out of Bitcoin and I personally noticed things were getting too dicey.

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Re: Electricity is free is you steal it

The nature of the BitCoin maths is that PCs are rubbish at mining. You can buy something a million times more powerful that it's just not worth trying to get PCs to do it.

However Graphics cards are 100 times better than the CPU for BitCoins so an online games company programmer decided to put mining software into the game. He mined quite a few but got caught when gamers graphics cards started getting very hot.

LiteCoin mining is another matter. The maths that drive that can't be done so easily with non-PC hardware. The PC is the best tool and the graphics card is the top component.

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Re: Electricity is free is you steal it

I am not quite sure about it. The difficulty is so great that specialized hardware is used. The smaller of them does 5 Gh (giga hashes)/s. Is uses about 10W, and is a small cube. And people use this (and its big brothers, going up to 500 Gh/s miner - the size of a big tower home PC. It is against this that a bot network would go against.

To add a little perspective: a Core i7 3930k is quoted as going as high as 66.6 Mh (mega hashes)/s. A dedicated machine, fine tuned to do mining, and doing nothing else.

Sure, 10k slave machines would do some good. But what are the odds of the infection going unnoticed, when it is gobbling 100% of the CPU power, turning the computer in a home heater?

It is not that isn't feasible. It's just that I believe is more profitable to send spam and another nasties.

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Re: Electricity is free is you steal it

"Sure, 10k slave machines would do some good. But what are the odds of the infection going unnoticed, when it is gobbling 100% of the CPU power, turning the computer in a home heater?"

If it finds slaves with viable GPUs, the malware can use the OpenCL cores to make these slaves increase the MHash output. Just a few hundred slaves with GPUs within three generations of present could even the stakes. Plus smart trojans can wait for low activity or nightfall to do its dirty work, making it less likely to be noticed.

As for the "other dirty work," it doesn't have to be either/or. Do that on the side as well. Malware diversification.

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It seems to me that any threat to bitcoin will more likely come in the form of an attempt to make and then manipulate a market by conventional means, similar to the way the silver price has been heavily controlled ever since the Hunt brothers' misadventure showed how easy it was. The limited size (by design) of the overall bitcoin pool makes it look vulnerable to me at least in its early years... while the price remains relatively low a bad actor could easily buy into a very large segment of the available supply and end up with de facto control. That said I own a few, they've seen a notional 1500% rise against the pound since I bought them and if it were easier to spend them I would be doing so right now. There are a lot of smart people working hard to find the problems and fix them so I still have high hopes for either BTC or its successor.

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Coat

" All this coal belongs to me lads"...

...Now THAT'S a 'Greedy Miner'.

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Coat

28 per cent and 23 per cent,

51%

Sounds like a bad thing to join...

(double meaning there)

I think time to leave.

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This already happened in the early days

But no one cared, because new coins were showing up every few hours on basic home PCs.

There are quite a few Bitcoin-ish derivatives that geeks and crims trade about, and it's very common for everyone's investment to suddenly not authenticate when a new mystery chain appears from someone attempting to take over the currency. Sometimes it's abandoned right then, sometimes now.

For BTC itself, it seems like you'd all have to toil for years with the most advanced mining hardware, always upgrading, to stay ahead.

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