Selfish mining is an attack on the Bitcoin network that has been known to be possible for several years. By propagating new blocks slowly (on purpose or by accident), a loophole is opened for miners to unfairly increase their profits in relation to other miners.
However, researchers Cyril Grunspan and Ricardo Pérez-Marco claim that by broadcasting the presence of orphan blocks, selfish mining can become a thing of the past.
Grunspan, a professor at Paris’ ESILV graduate school of engineering, and Pérez-Marco, the director of research at the National Center for Scientific Research (CNRS) in Paris, have authored a report on the costs of selfish mining and its profitability, which they believe have been largely ignored by the Bitcoin community. As former mathematicians, both men were introduced to Bitcoin in 2011 and developed a lasting taste for it. The authors have worked hard to increase awareness and adoption throughout France and recently organized the Paris Cryptofinance Seminar, which took place in October 2018.
Speaking with Bitcoin Magazine, Pérez-Marco describes selfish mining as a “block-withholding strategy,” and says it was first discovered in 2012 in the BitcoinTalk Forum. Rogue (selfish) miners do not publish mined blocks as indicated by the Bitcoin protocol, but instead try to build an advantage with respect to the official blockchain so they can invalidate a maximum number of honest blocks when releasing their secret chain.
Pérez-Marco says the duo has made two main contributions to the analysis of this problem.
“The first one is to build a correct model for the profitability of the strategy that was lacking, based on the iterative games (inspired from other gambling problems) that account for the profit and loss per unit of time.”
Based on this model, Pérez-Marco says that without a difficulty adjustment, the honest mining strategy still ranks as the most profitable one, as selfish mining tends to be...