[bitcoin-dev] SPV Mining reveals a problematic incentive issue.

[Jeff Garzik]

The miners with invalid blocks were punished with a loss of bitcoin
income...


On Sat, Jul 11, 2015 at 4:05 AM, Nathan Wilcox <nathan at leastauthority.com>
wrote:

> Thesis: The disincentive miners have for verifying transactions is
> problematic and weakens the network's robustness against forks.
>
> According to the 2015-07-04 bitcoin.org alert [1]_ so-called "SPV Mining"
> has become popular across a large portion of miners, and this enabled the
> consensus-violating forks to persist. Peter Todd provides an explanation
> of the incentive for SPV Mining over in another thread [2]_.
>
> .. [1] https://bitcoin.org/en/alert/2015-07-04-spv-mining#cause
>
> .. [2]
> https://www.mail-archive.com/bitcoin-dev@lists.linuxfoundation.org/msg00404.html
>
> If there is a cost to verifying transactions in a received block, then
> there is an incentive to *not verify transactions*.  However, this is
> balanced by the a risk of mining atop an invalid block.
>
> If we imagine all miners verify all transactions, except Charlie the
> Cheapskate, then it's in Charlie's interest to forego transaction
> verification.  If all miners make a similar wager, then in the extreme,
> no miners verify any transactions, and the expected cost of skipping
> transaction verification becomes very high.
>
> Unfortunately, it's difficult to measure how many miners are not
> validating transactions, since there's no evidence of this until they
> mine atop on invalid block. Because of this, I worry that over time,
> more and more miners cut this particular corner, to save on costs.
>
> If true, then the network continues to grow more brittle towards the kind
> of forking-persistence behavior we saw from the July 4th (and 5th) forks.
>
> This gets weird.  For example, a malicious miner which suspects a large
> fraction of miners are neglecting transaction verification may choose to
> forego a block reward by throwing an erroneous transaction into their
> winning block, then, as all the "SPV Miners" run off along a worthless
> chain, they can reap a higher reward rate due to controlling a larger
> network capacity fraction on the valid chain.
>
> Can we fix this?
>
> --
> Nathan Wilcox
> Least Authoritarian
>
> email: nathan at leastauthority.com
> twitter: @least_nathan
>
> Standard Disclaimer: I'm behind on dev archives, irc logs, bitcointalk,
> the wiki...  if this has been discussed before I appreciate mentions of
> that fact.
>
>
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>
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