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'Selfish Miner' Attack Could Devastate Bitcoin, Researchers Say

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Credit: Bitcoin Magazine

Cornell University researchers say Bitcoin is vulnerable to an attack that could have a devastating impact on the virtual currency, but it can be fixed with a software update. The attack involves miners, or people running computers that verify Bitcoin transactions, according to Cornell researcher Ittay Eyal. Every 10 minutes, miners are rewarded with 25 bitcoins for lending their computing power to Bitcoin if they solve a cryptographic puzzle first. However, if a mining group controlled more than 50 percent of Bitcoin's processing power, the network could be vulnerable to a variety of attacks.

In addition, small miners may unknowingly join a malicious group. Miners are supposed to follow Bitcoin's software protocol, but the network could be disrupted if less than 10 percent of miners decide not to follow it. A malicious mining group could split Bitcoin's public ledger into a competing chain by only selectively revealing some of the transactions they have processed. The researchers suggest that limiting mining pools to no more than 25 percent of the total number of nodes on the network would fix the problem.

From IDG News Service
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