When an attacker publishes a longer chain, does Bitcoin Core emit a warning?

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When a previously unknown chain fork of at least 7 blocks length is published, how does Bitcoin Core react?

It reorganizes to that chain, any transactions that were lost are returned to the nodes mempool.

Would Bitcoin Core accept the chain fork if it had the most work?

Any valid chain with the most work will be reorganised to.

How prominent is the warning to the user?

That warning isn't shown to a user in a reorganisation. Users are shown a warning when there is a significantly higher chain than them with valid proof of work but invalid contents, or alternatively when a soft fork takes the block version number higher than their client is aware of. When a warning is shown to a uiser through the alert system, it is either in the alerts field of the RPC output or in a small yellow bar in the GUI client.

Does Bitcoin Core need manual intervention to decide which fork to accept?

The code has the rules, if users made their...

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An attacker has a hard time changing the past

An attacker has very limited influence to change old blocks, because he has to replace all blocks that confirm the event he wants to change and keep up with the new ones that the network is still creating.

Example:
Say, Eve achieved to control 51% of the hash rate and wants to unconfirm a transaction from 6 blocks in the past.

To succeed, she has to provide 6 + X + 1 blocks, while the rest of the network finds X blocks.

With a hash rate distribution of 51:49 solving for X:

Eve would have to sustain control of 51% of the network's hashrate for an average of 172 blocks in order to unconfirm a transaction confirmed by six blocks.

That would be approximately 28 hours and 40 minutes. My calculation is simplifying the process by expecting a fixed block interval, as in reality, mining is a random process, it could take much longer or shorter.

Change a week of history?

For a...

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Imagine a scientist reading about an experimental result and then repeating the experiment for herself. Doing so allows her to trust the result without having to trust the original scientists.

Bitcoin Core checks each block of transactions it receives to ensure that everything in that block is fully valid—allowing it to trust the block without trusting the miner who created it.

This prevents miners from tricking Bitcoin Core users into accepting blocks that violate the 21 million bitcoin limit or which break other important rules.

Users of other wallets don’t get this level of security, so miners can trick them into accepting fabricated transactions or hijacked block chains.

Why take that risk if you don’t have to? Bitcoin Core provides the best possible security against dishonest miners along with additional security against other easier attacks (see below for details).

How Validation Protects Your Bitcoins

and put your...

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No matter what Bitcoin software you use, you should never buy more bitcoins than you can afford to lose. Bitcoin is still an experimental system and bitcoins remain a risky investment.

Bitcoin Core puts you in charge of your wallet, which means your bitcoins are at risk unless you complete certain tasks:

By default, you need to backup Bitcoin Core after every 100 transactions. This includes both transactions you send as well as payments you request (whether or not you actually received the payment).

For example, you need to backup after sending 33 payments and requesting 67 payments (even though you only received 60 payments).

Bitcoin Core can be configured to allow you to go more transactions between backups. See the -keypool setting.

Anyone who gets access to your wallet can steal your bitcoins. The first line of defense against this is encrypting your wallet, an option from the File menu in the graphical interface.

However,...

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I’ve had a look around and can’t find an answer to this.

Is it possible to attack the current Bitcoin blockchain with a competing blockchain that is longer than it?

For example to attack the current blockchain within the timespan of roughly a quarter of its current lifetime you would:

1. Work out the length of the current blockchain to be attacked.
2. Work out the maximum hashing power of the hardware you wish to use to generate the new blockchain.
3. Recursively divide the hashing power of the hardware by four for each difficulty adjustment the current blockchain has undergone. E.g. if you have a hashrate of 640 KHs and the blockchain has undergone 3 difficulty adjustments you would calculate 640KHs/4^3 = 10KHs.
4. Start generating the new blockchain from the genesis block, starting with the lowest calculated hashrate. For this example 10KHs.
5. Each time the blockchain’s mining difficulty is re-calculated the hardware then...

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There’s been a lot of talk in the Bitcoin community lately about stuff like a “fork”, “segwit” and “Bitcoin Unlimited”. Many people don’t understand what all of this is about but it’s creating a lot of stress due to misleading or partial information that is being spread.

In this post I will aim to clarify the uncertainty and give a better view of what’s going on mainly for newbies and non technical people. Hopefully, once you finish reading this post you will know what’s going on in the Bitcoin community these days and will be able to better prepare yourself for the different outcomes.

A short disclaimer before I begin – I’m not a technical person and I have little technical background. The information I bring here today is what I’ve managed to collect after weeks of research from around the web. I may sometimes oversimplify technical issues in order to easily explain them.

I believe there are only a handful of people who understand this issue and its...

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Table of contents

General

What is Bitcoin?

Bitcoin is a consensus network that enables a new payment system and a completely digital money. It is the first decentralized peer-to-peer payment network that is powered by its users with no central authority or middlemen. From a user perspective, Bitcoin is pretty much like cash for the Internet. Bitcoin can also be seen as the most prominent triple entry bookkeeping system in existence.

Bitcoin is the first implementation of a concept called crypto-currency", which was first described in 1998 by Wei Dai on the cypherpunks mailing list, suggesting the idea of a new form of money that uses cryptography to control its creation and transactions, rather than a...

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Frequently in popular descriptions of Bitcoin and in the user interfaces of wallet software, a distinction is made between “confirmed” and “unconfirmed” transactions. What is the difference?

At a high level, a transaction is only confirmed when it is permanently included in the Bitcoin blockchain. The blockchain is a ledger of all transactions in the history of Bitcoin. It is append-only, meaning new data can be added to the end of the ledger, but data can never be removed once included. This ledger is necessary to prevent double-spending, which is a key technical challenge in designing any cryptocurrency.

How Bitcoins are Transferred

Recall that if Alice “owns” some quantity of bitcoins, this really means she knows one or more cryptographic keys which have been designated as the controller of those coins in a transaction on the ledger which transferred the coins to Alice. In order to transfer the coins to another entity, Alice will use these keys to produce a...

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Original Question: “Why isn't the size of the blockchain a serious problem for Bitcoin ?”

The size of the blockchain is indeed a serious problem, but in relative terms as the cost for providing an immutable digital entity it is quite justified.

I can wholeheartedly sympathize with your predicament with the blockchain size being too large to incorporate a node on your machine and as do many other people.
I have noticed a lot of people switching from a completely hosted node to using just the light resources without actually hosting the whole node since the setup was consuming overall on both the hardware end and on the expertise aspect of it.

There might arise a situation where the Bitcoin ledger is so humongous that people need to host data centers to actually host these transactions, but it would still require consensus similar to how hyperledger makes use of multiple servers to reach consensus beforehand.

Hyperledger makes use of consensus reached...

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As with the plain race attack, Alice can reduce the risk of a Finney attack by waiting for the payment to be included in the blockchain.

Bitcoin Core :: Segregated Witness Adoption

An ad hoc decentralized network of volunteers is sufficient. Furthermore, hyperlinks to child porn websites have been added to the blockchain as arbitrary data can be included when a transaction is made. Alice can reduce the risk of race attack stipulating that she will not deliver the goods until Eve's payment to Alice appears in the blockchain. A rough overview of the process to mine bitcoins is: New transactions are broadcast to all nodes. Child pornography, murder-for-hire services, and weapons are also allegedly available on black market sites that sell in bitcoin. This payment is proportional to the amount of work an individual miner contributed to help find that block. Each block that is added to the blockchain, starting with the block containing a given transaction, is...

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New technology will be deployed when it is ready and has been tested. However, we believe the following is a reasonable schedule for the specific improvements described in the roadmap.

Segregated witness testnet: a separate testnet (not part of the regular testnet) that provides an opportunity for Bitcoin Core contributors to test segregated witness and for wallet authors to begin working with it.

Libsecp256k1 verification: 500% to 700% speed boost on x86_64 hardware during verification to help new full nodes join the network and to lighten the burden on existing nodes.

OP_CHECKSEQUENCEVERIFY: 25,000% improvement in bi-directional payment channel efficiency by allowing users to keep channels open as long as they want.

VersionBits: increase the maximum number of soft forks able to be deployed simultaneously from 1 to 29, allowing for faster and more decentralized future upgrades of the network.

Segregated witness: 175% to...

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Bitcoin has stared down an existential threat, after a consortium of miners briefly gained enough processing power to theoretically destroy the currency.

For a few hours on Friday, mining pool Ghash.io controlled 51% of all the processing power being used to perform the calculations that keep bitcoin secure. If it had abused that power, it would have had the ability to indirectly take money from other users, for instance by buying something and then rewriting history so that the purchase never happened.

But shortly after the threshold was breached, some members of the mining pool pulled their computing power from the group, averting – or at least, delaying – catastrophe.

"The high level of combined hash power in the Ghash pool is concerning to many participants in the system," said one such member, BitFury, an industrial bitcoin mining firm. "As a leader and trusted partner in the bitcoin system, BitFury has decided to transfer some of its hashing power away...

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