Tag: mempool

What Happens When the Bitcoin Blockchain Produces an Empty Block

Bitcoin (BTC) is a digital currency that is renowned for its durability, security, and dependability. A new block is added to the network on average every ten minutes, and the miner who successfully creates the block is rewarded with 6.25 Bitcoin, which is equivalent to almost $130,000.

On the other hand, the Bitcoin blockchain is known to sometimes spring a surprise on both watchers and players.

Nodes around the network confirmed the existence of a totally empty block at the height of 776,339 blocks. The fact that the block was uploaded to the Bitcoin network with no transactions included caused considerable consternation among those involved in the cryptocurrency industry. What precisely is meant by the term “empty block,” and how does this phenomenon occur?

To begin, while the presence of an empty block on the network may at first seem peculiar, this kind of thing is really rather common. Block 774486 was the location where it happened a little more than two weeks ago to the day.

Miners are encouraged to mine blocks as rapidly as possible, and as a result, they may mine a block even if they have not yet received any transactions that they may include in the block. When this occurs, the block will continue to be empty.

The following justification may be found in the Bitcoin mempool, which is the primary location for doing research on the Bitcoin blockchain: “When a new block is located, mining pools will give miners a block template that does not include any transactions. This will allow them to begin the search for the next block as quickly as possible. They immediately transmit a block template that is complete with transactions; but, a complete block template is a larger data transfer and reaches miners after a little longer period of time.

“During this interim period, which is often no more than one to two seconds, miners sometimes get fortunate and discover a new block utilizing the empty block template,”

In essence, mining a template was a case of “getting fortunate” for the miners. The Bitcoin block with the height of 776,389 was added to the chain just a few seconds after the block that came before it, which had the height of 776,488. However, Block 776,388 received an additional 0.086 BTC in fees, which is equivalent to around $1,854. This amount was added to the block reward of 6.25 BTC, which is approximately $135,247.

Even when there are no transactions in an empty block, the miner is still rewarded with freshly created bitcoins as part of the block reward. As a result, the reward for Block 776,389 was 6.25 Bitcoin and there were no transaction fees. The winning miner was Binance Pool, which contributed as much as 12% to the overall hash rate of the network.

It is essential to emphasize the fact that empty blocks do not provide a challenge for the network. Mining empty blocks still results in the production of the coin creation transaction, sometimes referred to as the coinbase transaction. This transaction ensures that Bitcoin is on track to meet its goal of having 21 million Bitcoins in circulation.

The proportion of vacant blocks on the network is often between between 1% and 2%, as seen by the statistics provided by BitInfoCharts. Given the proliferation of “ordinals” on Bitcoin, also known as the capacity to permanently carve photos, data, and marks into the blockchain, this statistic is even more shocking in light of its current state.

The increase in ordinals has led to various queries and even some anxiety among the Bitcoin community, and only lately the very first cases of pornography were documented.

As more and more image aficionados compete to have their work included in the Bitcoin blockchain, the mempool has become a more congested place, and block space has become a disputed resource.

New Bitcoin Lightning Network Vulnerability Exposed: The Replacement Cycling Attack

A recent revelation on the Lightning Network vulnerability known as a “replacement cycling attack” has prompted notable security researcher and developer, Antoine Riard, to step down from his role on the Lightning Network development team. The disclosure of this attack came to light through a detailed thread shared on Twitter by a developer known as mononaut, on 21st October 2023. This attack exploits a particular mechanism within the Lightning Network’s transaction process, causing potential financial loss to users engaged in a channel.

The Mechanism Behind the Attack

The Lightning Network operates as a second layer on top of the Bitcoin blockchain, with the primary goal of scaling the Bitcoin (BTC) transaction capability by facilitating off-chain, peer-to-peer transactions. Users can establish payment channels within the network, execute multiple transactions off-chain, and then record the aggregate transaction on the Bitcoin blockchain upon completion. The core of this attack lies in the manipulation of the Hash/Time Lock Contract (HTLC) outputs, which are essential for securing transactions while they are routed through the network.

The attack unfolds in a multi-step process. Initially, when a payment is being routed through a user, say Bob, from Alice to Carol, the payment is safeguarded by HTLC outputs in Bob’s pre-signed channel commitments with each peer. A crucial feature of this setup is the timelock mechanism, which ensures that the outgoing HTLC to Carol expires before the incoming HTLC from Alice, providing Bob a window to react in case of any issues.

The attacker’s objective is to exploit this mechanism by forcing Bob to time-out the transaction on-chain when Carol fails to reveal the payment preimage before the timelock expiration at block T. Upon doing so, Bob broadcasts a transaction to close his channel with Carol and reclaims his funds through an “htlc-timeout” transaction. The attackers, upon spotting this transaction, swiftly broadcast an “htlc-preimage” transaction with a higher fee rate, replacing Bob’s transaction in the mempool. This cycle is repeatedly performed to thwart Bob’s attempt to reclaim his funds, ultimately leaving Bob at a financial loss if the cycle continues for Δ blocks, allowing Alice to time-out the HTLC on the other channel.

Antoine Riard’s Resignation and Concerns

The intricacy and potential danger posed by this attack have raised grave concerns among developers. Antoine Riard vocalized these concerns in a conversation on a public mailing list maintained by the Linux Foundation. He highlighted the tough predicament the Bitcoin community finds itself in due to these newly discovered attack vectors, terming the Lightning Network’s situation as “perilous.”

Riard stressed that a substantial remedy can only be achieved at the base layer of the network, which might necessitate modifications to the core Bitcoin network, a move requiring robust community consensus due to its impact on the decentralized ecosystem’s security architecture. The concerns go beyond just this attack, touching on the overall complexity of the network and the high expectations placed on user experience by the Lightning Network developers.

Despite these hurdles, the Lightning Network continues to gain traction with a reported value locked in of $159.5 million, as per data from DefiLlama, marking a steady growth since its inception in 2018. However, Riard’s departure and warning signal looming challenges for the primary cryptocurrency ecosystem, necessitating a thorough examination and resolution of these vulnerabilities to sustain the network’s growth and user trust.

Exit mobile version