**_Cryptocurrencies are prone to many different types of attack. As Bitcoin is over 11 years on the track, we know and were facing many different attempts on breaking its security. One of them is network partition attack._**
But what about the Proof-of-Stake algorithms? Have they solved some of the vulnerabilities of Bitcoin and its Proof-of-Work algorithm?
Cryptocurrency protocols implemented as a top layer of TCP/IP stack in the so-called application layer. It can be said that cryptocurrencies directly use the entire TCP/IP infrastructure. If someone has control power over this
infrastructure, they can hurt all application protocols. This is a general
threat of all cryptocurrencies.
A few weeks ago, after I started my path as an Algorand ambassador, I had an opportunity to interview the leaders of Algorand foundation, Silvio Micali and Massimo Morini.
I asked them different kinds of questions including some more technical ones about network partition attacks, which interest me. Then I decided to go deeper into this topic.
In my eyes, Algorand stands right in the middle of the blockchain trilemma triangle, when the scalability and security are not taking anything from a decentralization degree. Later on, in the article I try to compare Algorand’s solution with another blockchain project, which seems to be very far with their development, Cardano. But my first look will go to Bitcoin and its approach to the protection from network attacks.
What is a network attack?
So, what the typical network attack is?
Any decentralized system is susceptible to a network attack in which an adversary targets the communication links between users, making it difficult or impossible for users to interact. An adversary could partition the network into isolated pieces, so that members of one piece can only communicate with each other but not with members of other pieces. During a network partition, the network is completely asynchronous and the adversary has total control over who receives which messages and when. If the partition lasts long enough and the underlying blockchain didn’t take this into consideration in its design, then the adversary may be able to convince different groups of users to accept different blocks at the same height in the blockchain. As a result, contradicting transactions will be accepted by different users, allowing the adversary to double-spend their money.
Bitcoin and network attacks
Let’s firstly look upon Bitcoin and its solution on network attacks.
At a high-level, Bitcoin is a randomly-established peer-to-peer network composed of thousands of nodes and tens of thousands of connections which rely on flooding to propagate transactions. As an attacker, being able to prevent the spread of information in such a network seems unrealistic, if not impossible. Bitcoin is surprisingly centralized from an Internet routing perspective: 20% of the Bitcoin nodes are hosted in less than 100 IP prefixes. To put this in perspective, there are close to 600,000 IP prefixes advertised in the Internet today. At the same time, few well-established ISPs (e.g. Hurricane Electric) naturally see a large fraction of the Bitcoin traffic. Together, these two characteristics make large-scale routing attacks surprisingly practical.
Because of its centralization, partitioning the Bitcoin network and isolate 50% of its mining power only requires a small routing attack, one which is orders of magnitude smaller than the attacks routinely seen in the Internet today. Any malicious ISP with access to the Internet routing infrastructure can perform this attack which starts to be effective after only few minutes (according to our own measurements on the live network). Any ISP transiting Bitcoin traffic can delay the propagation of mined blocks (for up to 20 minutes), in a stealth way, even if she sees one direction of the traffic.
Partitioning attacks
With partitioning attacks, an attacker aims at splitting the Bitcoin network into (at least) two disjoint components such that no information (e.g. transaction) can be exchanged between them. To partition the network into two components, a network attacker intercepts all the traffic destined to all the Bitcoin nodes contained within one of the component and drops any connection to the other component. To intercept traffic, a network attacker relies on vulnerabilities in the Border Gateway Protocol (BGP), the only Internet routing protocol used today, which does not validate the origin of routing announcements. These attacks, commonly referred to as BGP hijacks, involve getting a router to falsely announce that it has a better route to some IP prefix. By hijacking all the IP prefixes pertaining to the nodes in one component, the attacker can effectively intercept all the traffic exchanged between the two components. Once on path, the attacker can sever all these connections effectively disconnecting the two components. An animation of the attacks can be found on our website.
Illustration of how an AS-level adversary (AS8) can intercept Bitcoin traffic by hijacking prefixes to isolate the set of nodes P = (A, B, C, D, E).
The extreme centralization of Bitcoin from an Internet viewpoint makes partition attacks particularly effective as few IP prefixes need to be hijacked. Indeed, our measurements show that 50% of Bitcoin mining power is hosted in only 39 prefixes (i.e., in 0.007% of all Internet prefixes). This allows an attacker to isolate ~50% of the mining power by hijacking only these 39 prefixes. Much larger BGP hijacks (involving orders of magnitude more IP prefixes) are routinely seen in the Internet today.
By partitioning the network, the attacker forces the creation of two parallel blockchains. After the attack, all the blocks mined by the side with the shorter chain will be discarded together with all included transactions and the corresponding miners’ revenues. Moreover, discarded transactions will be irrecoverably canceled if there exist other transactions in the prevailing branch of the chain which spent the exact same Bitcoins (conflicting transactions).
#network-partitioning #algorand #cardano #proof-of-work #proof-of-stake #pure-proof-of-stake #blockchain-security #bitcoin-interview
