Horizen knows how to prevent 51% attack29.10.18 09:30
The famous attack on ZenCash occurred on 3 June. The attacker took control over the mining network and sold 23,152.3 coins twice.
How does such hacking happen?
A cybercriminal sends a transaction, and before the mining community confirms it, he or she sends another transaction, which contradicts the first one. Then, the hacker mines blocks that include the second transaction, thus confirming it. If the chain is long enough, the community will decide that it is valid and approve it. In such a way, the first transaction will be invalidated. Since the community is able to track all the real-time adjustments, malicious mining has to be non-public.
After the incident, ZenCash published an appeal to users, in which it is reported that the attack was carried out against the exchanger, not the blockchain, and that the latter is still safe. Then, the team began developing a complication of 51% attack in order to make it more expensive and less probable.
Now, finally, members of Horizen team Alberto Garoffolo, Pier Stabilini, Robert Viglione, and Uri Stav introduced an algorithm that can solve the problem. The solution has been titled “Proposal to Modify Satoshi Consensus to Enhance Protection Against 51% Attacks – A Penalty System For Delayed Block Submission”.
The principle of the proposal is to make non-publicly created chains extra fined. There is no penalty in the usual sense for such chains; they are delayed, thus using much more electricity than ordinary ones. Therefore, the hacking attempt will be economically unprofitable. Moreover, during the delay, the community may notice an attack and eliminate it. If the chain contains a little number of non-public blocks, it will be not delayed.
At first glance, the solution seems to be not suitable for cryptocurrencies with fast mining, like Ethereum, where the average mining speed of a block is 10 seconds. However, the developers claim that in this case the proposal can also be used, but the fine may be somewhat lower.
It is not yet known whether the Horizen solution can be applied to the Bitcoin blockchain, but it is still crucially important for the crypto world in general. Altcoins play a large part in crypto innovations because they are the source of new ideas and improvements. Yet, 51% attack can be a stumbling block in the development. The application of Horizon’s proposal may provide wider opportunities for the coins that are subject to 51% attacks, and thus increase the number of innovative projects and new ideas.