Jimmy Song on the Game Theory of Bitcoin Attacks and why Proof of Work Needs to be Expensive

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This is why proof of work needs to be expensive, if it is cheap you can roll back things easily. You want it to be very difficult to change history. The only way to make it difficult to change history is to make the process of writing the current history very expensive.
— Jimmy Song

Interview location: Skype
Interview date: Monday 1st October 2018
Company: Programming Blockchain | Blockchain Capital

The recent Bitcoin protocol bug, CVE-2018-1744, received considerable amounts of alarmist press, “For less than $80,000, you could have brought down the entire network,” “The most catastrophic bug in recent years, and certainly one of the most catastrophic bugs in Bitcoin ever.” Despite these claims, few looked into the detail of the bug and the game theory behind executing an attack.

Code has bugs; code has always had bugs, rather than focus on criticising developers it is important to assess how it happened, why it happened and how to avoid similar problems in the future. Alongside process, it is also important to not just analyse the potential damage a bug can cause but also the game theory behind an attack.

While the founder of the bug, Awemany, used his discovery of the bug to launch a scathing and personal attack on Bitcoin, Jimmy Song analysed the bug, how it could be exploited and the game theory behind such an attack.

This week I caught up with Jimmy to discuss his findings, and also:

  • State level attacks

  • Mining centralisation

  • 51% attack game theory

  • Why proof of work needs to be expensive

  • How non-techies can support Bitcoin

 

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A big thanks to my WBD Maximalist Patrons for helping support the show: JP Petit, Logan, Seb Walhain, Steve Foster and Tony Rousmaniere.