Post
Topic
Board Development & Technical Discussion
Re: Proof that Proof of Stake is either extremely vulnerable or totally centralised
by
d5000
on 08/09/2018, 06:39:01 UTC
Well, let's have an example (with a "chain trust" based coin):

You're staking with 21 UTXOs of 1% each and 1 UTXO of 30% of the total staking capacity each (51% total).
You want to trick an exchange, double spending some coins, and need a fake chain of 21 blocks.
Now you double-spend. Then you privately mint the 21 blocks with the relatively small 1% stakes.
Block 22 is crucial, because there you must trick the other nodes into a re-org. So for block 22, you use the 30% stake, to boost chain trust. Now you publish the fake chain. The 30% stake now gets "dormant", but after the fake chain was published, you don't need any stakes to be "live" because you already tricked the other nodes to use your fake chain.

You have a high probability that your chain becomes the longest chain (with most chain-trust) then, because the accumulated stake in the fake chain is exactly 51% and the rest of the nodes only can accumulate 49% on the "honest chain", because they also are affected by the "dormant stake" rule.

If not (there is a certain probability for it), you can repeat the attack after all the "dormant" periods have expired. There is zero cost for that. There is a high probability that you eventually will succeed.