Quote from: rocks on January 06, 2015, 10:03:20 PM

Obviously, and so we are back to what I already stated, which apparently you didn't bother to read.

Quote from: rocks on January 06, 2015, 08:32:08 PM

1) There are two competing chains where one chain has only the attacker's blocks and the other chain has the honest miner's blocks. The goal of the attacker is to make their chain with their inclusion rules the longest. The network here can optionally choose the honest chain (which is what Gavin's proposal does). It also require 51% to pull off, which I don't think is possible anyway.

Which is the only possible path. This path both requires at least 51% of total hashing power, and it requires that the honest network (users, P2P nodes & miners) to ignore the 2nd chain with all transactions included. Neither of these are likely IMHO, and why the attack fails.

You still have not read my reddit posts, did you?

Summarizing them: Say the cartel has hashpower 0.54 * Z where Z is the total. The cartel first warns users that starting from block N, there will be a change in the protocol. The only substantive change will be the block reward, that will continue to be 25 BTC, for another 2 years, instead of dropping to 12.5 as originally planed. This change is actually necessary and good for bitcoin because the network is in grave danger bla bla bla. The cartel warns that users and miners who upgrade to the new version of the software, anytime before block N, will see no change at all. Users who do not upgrade will see no change until block N, but after that their transactions will not go through, or will be confirmed an then unconfirmed -- until they upgrade too. Starting from block N, miners who have not upgraded will not earn any rewards, until they upgrade too.

Starting with block N, the cartel redirects 0.52*Z hashpower to mine the original chain, and 0.02*Z to mine the new reformed chain, that forks from it after block N-1.

The miners working on the reformed chain (those 0.02*Z from the cartel, plus any other miners who have upgraded) use the new protocol, earn 25 BTC rewards, and accept all transactions from all clients that have upgraded. The difficulty is lowered temporarily in that fork so that those miners can sustain a reasonable block rate.

The other cartel miners, with power 0.52*Z, keeps mining according to the original protocol; except that, starting with block N, they ignore any blocks generated by miners with the old protocol, and mine only empty blocks, always using their last (empty) block as parent.

Thus, during that transition phase, there will be usually three chains: (1) the new main chain, gnerated according to the modified protocol; (2) the empty orthodox chain generated by the cartel; and, occasionally, (3) a short orthodox chain hanging from chain (2), generated by the orthodox miners. Note that the original protocol says that the orthodox clients and the orthodox miners must view (2) and (3) as equally valid, and always select the longest of the two. Since chain (2) has more hashpower working on it, chain (3) will eventually be discarded by those clients and miners, and even orhodox miners will use the last block of chain (2) as the parent of the new chain (3).

As the non-cartel miners upgrade to the cartel version, the cartel would repartition dynamically its power so that it always retains majority power in fork (1) (to foil any counter-attacks by rebels) and in the two forks (2)+(3), i.e. more power on (2) than the rebels have on (3). Eventually, most of the users and miners will be happily using fork (1). Then forks (2) and (3) can be abandoned by the cartel, since the rest of the ecosystem will not accept their bitcoins or recognize their transitions. The cartel will forfeit all the 12.5 BTC rewards that it collected in chain (2), but it would still have half of the 25 BTC rewards from chain (1) generated in that interval. Anyway, from then on the network and ecosystem would be just as before; but every miner would still be collecting the same revenue as before, instead having his revenue cut in half.

Since clients and miners will know this plan in advance, most of them should want to upgrade, out of self interest. There is a bit of prisoner's dilemma there; but for greedy users and miners, who will assume that most of the other players are greedy too, the decision to upgrade is almost a no-brainer. Only users and miners with an overpowering ideological motivation may try to stick to the original protocol, but they will only succeed if the cartel plus the defecting miners loses its majority position during the battle.

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Example during the March 2013 fork the autonomous machine decided to take the 0.8 branch, but a majority of human participants decided the 0.7 branch was a better path and shifted the machine back to that (causing a 30+ block re-org btw).

Yes, and that shows that the protocol can be changed -- even retroactively! -- if the miners agree to do that. Note that if only the users or only the miners had agreed to the rollback, the transactions would no longer go through; but while that would be disastrous for the users, it would make almost no difference for the miners, since they would still collect rewards from their empty blocks. And, in either case, the blockchain would use the version of the protocol that was chosen by the miners, not by the users.

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If a 51% attack ever happened it would be very visible and resisted by the majority of human participants, who all want bitcoin to succeed, and who would manually choose the shorter chain made by honest miners as the valid path. Gavin's proposal would automate this selection. A 51% attack, which is what you are relying all your arguments on, is both extremely unlikely, but also ineffective. Bitcoin would easily survive a +51% attack, but it will never have to because it is not going to happen.

You (and most "51% deniers") are still fixated on one particular type of attack, and are arguing that it would not work because users and miners would disapprove of it and would even violate completely the protocol (by manually bypassing the longest-chain rule) in order to "save" bitcoin. Again, please read my scenario above. An "attack" that changes the protocol so as to benefit miners and is not too harmful to users will probably succeed because it will be in the self-interest all parties. Who knows, by then Gavin may be working for the cartel and urging everybody to upgrade.

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But thank you for reminding my why I bailed on the academic path years ago and decided to live in the real world. You, like most academics I've encountered, seem to believe that writing long-winded obtuse arguments in a vacuum consisting of your own reality, somehow makes you intelligent or valuable.

Well, we obvioulsy disagree about who is detached from reality here.