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- Describe topological order to help readers understand how that solves the double spend problem - Mention that transactions can be safely relayed one block before their locktime allows them to be included in a block because they'll be valid next block. - Be a bit clearer about when subsidy becomes zero due to rounding and when BIP42 makes it zero unconditionally. - Describe the creation of the witness merkle root before the block header merkle root - Move up note about the retarget off-by-one bug - Make "best blockchain" an inherent property and not an alias for a current chain. When a new block arrives that triggers a reorg, we don't switch best blockchains---the new chain is the best blockchain and we switch to using it. - Combine two sections about forks that were repetitive - Mention that pool miners also need to prove they paid the pool's preferred coinbase transaction template - Add a todo to clarify terminology around the 51% attack. The existing text used this in a way that's consistent with how it was used in early Bitcoin history, but it's potentially confusing because it doesn't actually require a majority of hashrate to make the attack and it confuses it with a censorship attack that does require a majority (or at least a selfishing mining minority) to maintain. - Reduce the situations we describe as "double spends". Consensus prevents double spending within a valid chain; the other situations are about unconfirmed transactions, which might better be described using other terms that won't confuse readers into thinking Bitcoin's double spend protection doesn't work. - Add warning about backing up more than your seed when multisig or complex contracts are in use. - Add a todo to fix "millibits" situation, which might involve image changes. - Note that the first commitment transaction (the refund) needs to be signed before the funding transaction in LN channels. - Pluralize "bitcoin" as necessary (somehow missed this before). - Drop mention of tumblebit and teechan, which nobody is working on AFAIK.
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241 lines
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Plaintext
== Errata to the Bitcoin Whitepaper
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A description of known problems in Satoshi Nakamoto’s paper, "Bitcoin:
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A Peer-to-Peer Electronic Cash System", as well as notes on terminology
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changes and how Bitcoin's implementation differs from that described in
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the paper.
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This document was originally published by a co-author of this book in
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2016; it is reproduced here with updates. The numbers and names of
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sections in this errata correspond to the numbers and names of the
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sections in Nakamoto's original paper.
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=== Abstract
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____
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The longest chain not only serves as proof of the sequence of events
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witnessed, but proof that it came from the largest pool of CPU power.
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____
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* *Implementation detail:* If each link in the chain (called "blocks"
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in Bitcoin) was built using the same amount of Proof-of-Work (POW), the
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longest chain would be the one backed by the largest pool of
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computational power. However, Bitcoin was implemented in such a way that
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the amount of POW can vary between blocks, so it became important not to
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check for the "the longest chain" but rather "the chain demonstrating
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the most POW"; this is often shortened to "strongest chain".
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+
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The
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https://github.com/bitcoin/bitcoin/commit/40cd0369419323f8d7385950e20342e998c994e1#diff-623e3fd6da1a45222eeec71496747b31R420[change]
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from checking for the longest chain to checking for the most-work chain
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occurred in July 2010, long after Bitcoin’s initial release:
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+
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[source,diff]
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----
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- if (pindexNew->nHeight > nBestHeight)
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+ if (pindexNew->bnChainWork > bnBestChainWork)
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----
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* *Terminology change:* General CPUs were used to generate the POW for
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the earliest Bitcoin blocks but POW generation today is mostly performed
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by specialist Application Specific Integrated Circuits (ASICs), so
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instead of saying "CPU power" it is perhaps more correct to say
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"computational power" or, simply, "hash rate" for the hashing used
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in generating the POW.
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____
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As long as a majority of CPU power is controlled by nodes that are not
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cooperating to attack the network, they’ll generate the longest chain
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and outpace attackers.
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____
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* *Terminology change:* The term "nodes" today is used to refer to
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full validation nodes, which are programs that enforce all the rules of
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the system. Programs (and hardware) that extend the chain today are
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called "miners" based on Nakamoto’s analogy to gold miners in section
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6 of the paper. Nakamoto expected all miners to be nodes but the
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software he released did not require all nodes to be miners. In the the
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original software, a simple menu item in the node GUI allowed toggling
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the mining function or or off.
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+
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Today it is the case that the overwhelming number of nodes are not
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miners and that many individuals who own mining hardware do not use it
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with their own nodes (and even those that do mine with their own nodes
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often mine for short periods of time on top of newly discovered blocks
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without ensuring their node considers the new block valid). The early
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parts of the paper where "nodes" is mostly used without modification
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refer to mining using a full validation node; the later parts of the
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paper which refer to "network nodes" is mainly about what nodes can do
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even if they aren’t mining.
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* *Post-publication discovery:* When a new block is produced, the miner
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who produces that block can begin working on its sequel immediately but
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all other miners must wait for that new block to propagate across the
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network to them. This gives miners who produce many blocks an edge over
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miners who produce fewer blocks, and this can be exploited in what’s
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known as the _selfish mining attack_ to allow an attacker with around
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30% of total network hash rate to make other miners less profitable,
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perhaps driving them into following the attacking miner’s policy. So
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instead of saying "a majority of CPU power is controlled by nodes that
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are not cooperating to attack the network" it is perhaps more correct
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to say "as long as nodes cooperating to attack the network control less
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than about 30% of the network".
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=== 2. Transactions
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____
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We define an electronic coin as a chain of digital signatures. Each
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owner transfers the coin to the next by digitally signing a hash of the
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previous transaction and the public key of the next owner and adding
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these to the end of the coin.
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____
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* *Implementation detail:* Bitcoin implements a more general version of
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this system where digital signatures are not used directly but rather a
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"deterministic expression" is used instead. Just as a signature that
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matches a known public key can be used to enable a payment, the data
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that satisfies an known expression can also enable a payment.
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Generically, the expression that must be satisfied in Bitcoin in order
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to spend a coin is known as an "encumbrance". Almost all encumbrances
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in Bitcoin to date require providing at least one signature. So instead
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of saying "a chain of digital signatures" it is more correct to say
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"a chain of encumbrances". Given that transactions often have more
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than one input and more than one output, the structure is not very
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chain-like; it’s more accurately described as a directed acyclic graph
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(DAG).
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=== 4. Proof-of-Work
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____
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we implement the proof-of-work by incrementing a nonce in the block
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until a value is found that gives the block’s hash the required zero
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bits.
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____
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* *Implementation detail:* Adam Back’s Hashcash implementation requires
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finding a hash with the required number of leading zero bits. Bitcoin
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treats the hash as an integer and requires that it be less than a
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specified integer, which effectively allows a fractional number of bits
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to be specified.
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____
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Proof-of-work is essentially one-CPU-one-vote.
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____
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* *Important note:* the vote here is not on the rules of the system but
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merely on the ordering of the transactions in order to provide
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assurances that an "electronic coin" cannot be easily double spent.
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This is described in more detail in section 11 of the paper where it
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says, "We consider the scenario of an attacker trying to generate an
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alternate chain faster than the honest chain. Even if this is
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accomplished, it does not throw the system open to arbitrary changes,
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such as creating value out of thin air or taking money that never
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belonged to the attacker. Nodes are not going to accept an invalid
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transaction as payment, and honest nodes will never accept a block
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containing them."
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____
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proof-of-work difficulty is determined by a moving average targeting an
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average number of blocks per hour.
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____
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* *Implementation detail:* A moving average is not used. Instead, every
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2,016th block has its reported generation time compared to the
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generation time for an earlier block, and the difference between them is
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used to calculate the average used for adjustment.
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+
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Further, the average implemented in Bitcoin targets an average number of
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blocks per two weeks (not per hour as might be implied by the text).
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Other implemented rules may further slow adjustments, such as a rule
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that the adjustment can not increase block production speed by more than
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300% per period, nor slow it by more than 75%.
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=== 7. Reclaiming Disk Space
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____
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Once the latest transaction in a coin is buried under enough blocks, the
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spent transactions before it can be discarded to save disk space
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____
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* *Possible post-publication discovery:* Although the Merkle Tree
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structure described in this section can prove a transaction was included
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in a particular block, there is currently no way in Bitcoin to prove
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that a transaction has not been spent except to process all subsequent
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data in the blockchain. This means the method described here cannot be
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universally used for reclaiming disk space among all nodes, as all new
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nodes will need to process all transactions.
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=== 8. Simplified Payment Verification
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____
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One strategy to protect against this would be to accept alerts from
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network nodes when they detect an invalid block, prompting the user’s
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software to download the full block and alerted transactions to confirm
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the inconsistency.
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____
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* *Important Note:* although software has been produced that implements
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some parts of this section and calls that Simplified Payment
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Verification (SPV), none of these programs currently accepts alerts from
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network nodes (full validation nodes) when invalid blocks have been
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detected. This has placed bitcoins in so-called SPV wallets at risk in
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the past.
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=== 10. Privacy
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____
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Some linking is still unavoidable with multi-input transactions, which
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necessarily reveal that their inputs were owned by the same owner
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____
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* *Post-publication invention:* the revelation of a common owner for
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different inputs isn’t necessary if owners often mix their inputs with
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inputs belonging to other owners. For example, there’s no public
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difference between Alice and Bob each contributing one of their inputs
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towards paying Charlie and Dan than there is between just Alice
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contributing two of her inputs towards paying Charlie and Dan.
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+
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This technique is known today as
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https://en.bitcoin.it/wiki/CoinJoin[CoinJoin] and software implementing
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it has been in use since 2015.
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=== 11. Calculations
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____
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The receiver generates a new key pair and gives the public key to the
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sender shortly before signing. This prevents the sender from preparing a
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chain of blocks ahead of time by working on it continuously until he is
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lucky enough to get far enough ahead, then executing the transaction at
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that moment.
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____
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* *Post-publication discovery:* nothing about the receiver generating a
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public key shortly before the spender signs a transaction prevents the
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spender from preparing a chain of blocks ahead of time. Early Bitcoin
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user Hal Finney discovered this attack and
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https://bitcointalk.org/index.php?topic=3441.msg48384#msg48384[described
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it]: "Suppose the attacker is generating blocks occasionally. in each
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block he generates, he includes a transfer from address A to address B,
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both of which he controls.
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+
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"To cheat you, when he generates a block, he doesn’t broadcast it.
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Instead, he runs down to your store and makes a payment to your address
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C with his address A. You wait a few seconds, don’t hear anything, and
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transfer the goods. He broadcasts his block now, and his transaction
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will take precedence over yours."
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+
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The attack works for any number of confirmations, and is sometimes named
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the Finney Attack.
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'''''
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*Disclaimer:* the author of this document was not the first person to
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identify any of the problems described here—he has merely collected them
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into a single document.
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*License:* this errata document is released under the
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https://creativecommons.org/publicdomain/zero/1.0/[CC0] 1.0 Universal
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Public Domain Dedication
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For updates made after the publication of this book, please see the
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https://gist.github.com/harding/dabea3d83c695e6b937bf090eddf2bb3[Original
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document].
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