[article] on blockchain currencies, and double-spending


#1

I (only just) came across this article “On The Longest Chain Rule and Programmed Self-Destruction of Crypto Currencies” that argues there are more threats to the existing blockchain-currencies.

http://arxiv.org/abs/1405.0534

I have not yet taken the time to properly read it myself. I hope to do so soon, and comment here. Of course, safecoin technology is fundamentally different from the blockchain, but could be an interesting read.


#2

Thank you for the link. Here’s the PDF link to their white paper.

I quickly read through the 57 pages and found it interesting. The paper raises many questions, and concerns about Bitcoin and its clones. I appreciated that they offer solutions to the “potential” problems they see. No matter how perfect something may seem, it is always good to keep improving it.

I hope Safecoin will be the next evolution in crypto currency technology. It is very different from blockchain ledgers and may not have the exact same problems. But it will encounter its own problems in time. One part that keeps bothering me is the cap on safecoin. Their whitepaper also raises this issue.

For now, we have more important tasks to focus on, like making sure the testnets are functional.


#3

I don’t think cap on safecoin will have the same adverse effects as it potentially does with bitcoin. The issue is really nullified I believe mainly because there is no mining arms race, which then concentrates hashing power to an ever diminishing group of miners, which then makes attacks/fraud more likely and pushes price moonwards etc. Maidsafe avoids many (maybe all actually) of the forseen problems with bitcoin in the article. (half way through it btw).
The concerns raised seem valid and the main one is the assumption by many that following “the longest chain” is a good/secure thing – they claim it isn’t and give plausible reasons why not. An interesting idea raised is that a 51% attack (or many similar) only needs a small timeframe in which to execute – so over 50% of hashing power concentrated in small timeframe. Scenarios are given under which this situation can easily arise. It is interestingly speculated that under certain circumstances it may be profitable to rent cloud hashing power to orchestrate such an attack.
My initial thoughts/questions (if we concede article draws correct conclusions) are:

  1. Could future Safenet cpu power not be harnessed and converted into hashing power and be used anonymously to attack the Blockchain? If so what can we do to prevent this? for example would cpu rental have to be priced competetively to negate any attack motivation?
  2. Do we want to prevent this? –lol
  3. Would the answer to all the problems identified in the article be to host Blockchain on Safenet and change mining method to farming and use the proof of resource coin you have or something along those lines?
  4. Do we need to alert Bitcoin of potential future issues and offer a solution.
  5. Am I thinking too out of the box as usual?

Cheers


#4

All thoughts are welcome. That’s why we are here.

I guess I should explained my concern in detail. Right now, farmers are encouraged by the prospect of farming safecoin. If we have a coin cap same as Bitcoin, will famers continue to add more storage space after the cap?

The whitepaper “speculates” miners will seek more profitable alt coins for their resources. The same situation may affect safecoin. Hypothetical example: datacoin, a fork of safecoin, offers a higher payout rate. The logic is simple. Because we are approaching a cap, more resource will be needed for less payout. A farmer will see this, take their 20TB drives, and reallocate them to datacoin.

There is one reason I believe this will not be the case. Unlike Bitcoin and its clones, a fork cannot clone the community data already spawned in the SAFE Network. Yes, they may offer storage and similar functionality, but the community data will be invested in the SAFE Network. It would be like asking people to migrate from Facebook to another social network. Google has been trying very hard, but so far has failed to cause a migration. That doesn’t mean it is impossible.

Still, I would like to ensure farmers have a “personal” stake in the SAFE Network, by encouraging them to upload their own personal data. This is why I wanted to adjust the NSL (Network Storage Limit) based on farmer rank. We want them to make it their HOME. In either case, I think we are definitely ahead.


#5

Some confusion here - I’m not sure I’m correctly understanding “coincap” – does it mean a limit on how many coins a vault can mine or does it mean when all coins have eventually been farmed?


#6

When all coins have been farmed.

The current safecoin cap is set at 4.3billion and will be reached in 10 years. I should also note we will be recycling safecoins when people use it to buy storage, so it can be re-farmed.


#7

Ah, that’s what I assumed but wasn’t sure.

“The logic is simple. Because we are approaching a cap, more resource will be needed for less payout. A farmer will see this, take their 20TB drives, and reallocate them to datacoin.”

I’m not sure this is a simple logic, due to recycling and divisibility again, other uses of safecoin etc and the reasons you gave. I also don’t see why this is actually a problem for farmers even if it happens as farmers still make profit (from “datacoin”).

Market forces will dictate whether safecoin/safenet survive and we have a number of advantages not least first mover……we just need to move….first


#8

Agreed,
We have a lot of potential for success. We just need to move.