Author: Joseph Poon 2015-08-11 20:15:47
Published on: 2015-08-11T20:15:47+00:00
The email conversation discusses the potential for reorg attacks with Bitcoin, and how Lightning could reduce this vulnerability. The conversation shifts to a scenario where a user can double-spend despite M confirmations if it gains $X. The user would then open anonymous channels capable of receiving at least $X, start the doublespend fork, fund multiples lightning channels, wait for N confirmations so that new channels become active, quickly route multiple payments from new channels to anonymous channels until they can't send anymore, publish the doublespending fork so that $d*n never gets spent, and finally close original anonymous channels gaining $X. The only people worse off are those who opened $d channels after N confirmations. None of the ripped-off hubs need to know where the money ended up, so there’s not much potential for iron pipe cryptography to get money back. The constraints include how many channels you can open in M-N blocks, having >$X funds available in the first place to commit to double spend, and how much capacity the lightning network has in routable bitcoin. If it costs 1.4*25*M bitcoin to mount a double spend attack over M blocks (bribing 67% of hash power for the time it takes to do 2*M blocks), and you can open 2000 channels per block, then you’re putting up 525 bitcoin by flooding the blockchain with anchor transactions, sending it to yourself over lightning, then double spending the original 525 BTC at a cost of spending ~505 BTC on hash power. Increasing the blocksize or lowering the block reward increases the confirmations required. The conversation ends with Joseph Poon's signature.
Updated on: 2023-05-23T19:22:29.486501+00:00