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Short Paper: Revisiting Difficulty Control for Blockchain Systems

  • Dmitry Meshkov
  • Alexander ChepurnoyEmail author
  • Marc Jansen
Conference paper
Part of the Lecture Notes in Computer Science book series (LNCS, volume 10436)

Abstract

The Bitcoin whitepaper [1] states that security of the system is guaranteed as long as honest miners control more than half of the current total computational power. The whitepaper assumes a static difficulty, thus it is equally hard to solve a cryptographic proof-of-work puzzle for any given moment of system history. However, the real Bitcoin network is using an adaptive difficulty adjustment mechanism.

In this paper we introduce and analyze a new kind of attack on the mining difficulty retargeting function used in Bitcoin which we call “coin-hopping”. In a coin-hopping attack, a malicious miner increases his mining profits while at the same time increasing the average delay between blocks.

We propose an alternative difficulty adjustment algorithm in order to reduce the incentive to perform a coin-hopping attack, and also decrease inter-block delays. Finally, we evaluate our proposed approach and show how its novel algorithm performs better than the original algorithm of Bitcoin.

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Copyright information

© Springer International Publishing AG 2017

Authors and Affiliations

  • Dmitry Meshkov
    • 1
    • 2
  • Alexander Chepurnoy
    • 1
    • 2
    Email author
  • Marc Jansen
    • 3
  1. 1.IOHK ResearchSestroretskRussia
  2. 2.Ergo PlatformSestroretskRussia
  3. 3.University of Applied Sciences Ruhr WestMülheimGermany

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