5 ms·

Is Bitcoin security worth $1B?

42 points by mriou 12y ago

FBT 12y ago
A quick read of the title left me rather confused: Are they seriously asking the question "Is Bitcoin worth 1฿?" A tautology indeed. Only upon reading the article itself did I realize I misread the title: I had both skipped over the word "security", and misinterpreted the B as the Bitcoin symbol, rather than an abbreviation for a billion.
- collyw 12y ago
  prime numbers worth 1 billion....?
moe 12y ago
Reminder: For anything but toy apps you do not want to relay your interactions with the blockchain through a third party.
- asdfaoeu 12y ago
  To be clear really relaying transactions through a server is probably fine. The problem with this one is the api let's the server generate the transaction and the client just blindly signs it. You are completely trusting the server in this scenario.
  - mriou 12y ago
    Not blindly, you see both the generated transaction and the data to sign, you can validate either or both. And you are completely trusting a server in many other situations.
asdfaoeu 12y ago
> Multiple signature (multisig) transactions would have prevented all of it. Yeah, no, there's still a need for hot wallets which can be spent automatically by a server and these were basically the only ones stolen. You actually have to keep the keys separate for it to make a difference. Also their api is borderline retarded. The server passes back a hash to sign and the client is just supposed to blindly sign it. Sure I suppose it could check it but then why wouldn't you just build it locally.
- cheez 12y ago
  It is kind of ironic that people who are using a currency dependent on the security of crypto operations created an API that commits a fundamental mistake: trusting the data you receive.
  - CatheryneN 12y ago
    You don't have to trust our data - you can check it against the multitude of block explorers available in the market. However, if you use blockchain.info to check, be aware that they do not support pay-to-script transactions and will not show the transaction until it's confirmed. And you can easily check the received data. The security of our APIs lies in the fact we don't store private keys - the user signs their own transaction.
    - moe 12y ago
      the user signs their own transaction. If I understand it right then that is a lie. In reality you ask the user to sign a transaction that you create for him. This is extremely dangerous for the user (pretty close to signing a blank cheque) and I don't like how you try to downplay this flaw. Your API is broken by design and puts anyone who is naive enough to use it at great risk. You should take it offline.
      - ghkbrew 12y ago
        Seems more like signing a check someone else filled out for you. You can still verify the amount and refuse if it's wrong. Or am I wrong? Doesn't the transaction have to include all the relevant details before it's signed?
        moe 12y ago
        Yes, technically the transaction body does include all details. However, decoding and verifying a complex transaction takes about the same amount of work as generating it yourself to begin with... Their documentation clearly expects you to blindly sign whatever tx they make up for you. There's not a word on verifying the transaction locally before signing it. http://dev.blockcypher.com/#signing_sending http://dev.blockcypher.com/#signing_sending
jimrandomh 12y ago
Yes, multi-signature transactions can greatly improve security. But this idea of using a third party to write your transactions for you is a very, very bad idea. It introduces an additional point of failure for security: someone can break into their server, and make it start generating transactions that send coins somewhere other than where you said. Writing software that uses this API would be negligence.
- CatheryneN 12y ago
  Someone can also break into your servers and manipulate your transactions. It's our business to run a secure and reliable service. Bitcoin infrastructure is fairly complex and so the probably that you'll miss something are pretty high. Isn't it better to focus on your own business rather that spend all your time and money building and maintaining the backend piece?
  - deleted 12y ago
    [deleted]
  - nightpool 12y ago
    Then release/sell a library. Don't expect Bitcoin users (who, especially the early adopters, are almost tautologically more likely to distrust centralized services). Library code can be audited, and guaranteed to do what it advertizes.
  - asdfaoeu 12y ago
    > Someone can also break into your servers and manipulate your transactions. It's our business to run a secure and reliable service And now they have two servers they can break into?
Ryel 12y ago
Because of the amount of real money invested, I would (somewhat jokingly) say that securing Bitcoins is a business more valuable than Bitcoin itself.
matthewbauer 12y ago
We already spend a total of $15 million dollars per day in energy costs[1] making secure transactions in Bitcoin, so I think in a way we're already spending more than $5 billion on Bitcoin security. [1]: http://www.forbes.com/sites/timworstall/2013/12/03/fascinating-number-bitcoin-mining-uses-15-millions-worth-of-electricity-every-day/ http://www.forbes.com/sites/timworstall/2013/12/03/fascinati...
- kordless 12y ago
  I ran the numbers on newer mining rigs a few weeks ago and came up with a PH/s needing about 1 semi tractor trailer engine to run. The network is currently doing about 130PH/s, so that's about 130 semis engines running. Not anything to sneeze about, but also definitely not $15M a day.

42 points by mriou 12y ago

FBT 12y ago

A quick read of the title left me rather confused: Are they seriously asking the question "Is Bitcoin worth 1฿?" A tautology indeed. Only upon reading the article itself did I realize I misread the title: I had both skipped over the word "security", and misinterpreted the B as the Bitcoin symbol, rather than an abbreviation for a billion.

collyw 12y ago
prime numbers worth 1 billion....?

moe 12y ago

Reminder: For anything but toy apps you do not want to relay your interactions with the blockchain through a third party.

asdfaoeu 12y ago
To be clear really relaying transactions through a server is probably fine. The problem with this one is the api let's the server generate the transaction and the client just blindly signs it. You are completely trusting the server in this scenario.
- mriou 12y ago
  Not blindly, you see both the generated transaction and the data to sign, you can validate either or both. And you are completely trusting a server in many other situations.

asdfaoeu 12y ago

> Multiple signature (multisig) transactions would have prevented all of it. Yeah, no, there's still a need for hot wallets which can be spent automatically by a server and these were basically the only ones stolen. You actually have to keep the keys separate for it to make a difference. Also their api is borderline retarded. The server passes back a hash to sign and the client is just supposed to blindly sign it. Sure I suppose it could check it but then why wouldn't you just build it locally.

cheez 12y ago
It is kind of ironic that people who are using a currency dependent on the security of crypto operations created an API that commits a fundamental mistake: trusting the data you receive.
- CatheryneN 12y ago
  You don't have to trust our data - you can check it against the multitude of block explorers available in the market. However, if you use blockchain.info to check, be aware that they do not support pay-to-script transactions and will not show the transaction until it's confirmed. And you can easily check the received data. The security of our APIs lies in the fact we don't store private keys - the user signs their own transaction.
  - moe 12y ago
    the user signs their own transaction. If I understand it right then that is a lie. In reality you ask the user to sign a transaction that you create for him. This is extremely dangerous for the user (pretty close to signing a blank cheque) and I don't like how you try to downplay this flaw. Your API is broken by design and puts anyone who is naive enough to use it at great risk. You should take it offline.
    - ghkbrew 12y ago
      Seems more like signing a check someone else filled out for you. You can still verify the amount and refuse if it's wrong. Or am I wrong? Doesn't the transaction have to include all the relevant details before it's signed?
      - moe 12y ago
        Yes, technically the transaction body does include all details. However, decoding and verifying a complex transaction takes about the same amount of work as generating it yourself to begin with... Their documentation clearly expects you to blindly sign whatever tx they make up for you. There's not a word on verifying the transaction locally before signing it. http://dev.blockcypher.com/#signing_sending http://dev.blockcypher.com/#signing_sending

jimrandomh 12y ago

Yes, multi-signature transactions can greatly improve security. But this idea of using a third party to write your transactions for you is a very, very bad idea. It introduces an additional point of failure for security: someone can break into their server, and make it start generating transactions that send coins somewhere other than where you said. Writing software that uses this API would be negligence.

CatheryneN 12y ago
Someone can also break into your servers and manipulate your transactions. It's our business to run a secure and reliable service. Bitcoin infrastructure is fairly complex and so the probably that you'll miss something are pretty high. Isn't it better to focus on your own business rather that spend all your time and money building and maintaining the backend piece?
- deleted 12y ago
  [deleted]
- nightpool 12y ago
  Then release/sell a library. Don't expect Bitcoin users (who, especially the early adopters, are almost tautologically more likely to distrust centralized services). Library code can be audited, and guaranteed to do what it advertizes.
- asdfaoeu 12y ago
  > Someone can also break into your servers and manipulate your transactions. It's our business to run a secure and reliable service And now they have two servers they can break into?

Ryel 12y ago

Because of the amount of real money invested, I would (somewhat jokingly) say that securing Bitcoins is a business more valuable than Bitcoin itself.

matthewbauer 12y ago

We already spend a total of $15 million dollars per day in energy costs[1] making secure transactions in Bitcoin, so I think in a way we're already spending more than $5 billion on Bitcoin security. [1]: http://www.forbes.com/sites/timworstall/2013/12/03/fascinating-number-bitcoin-mining-uses-15-millions-worth-of-electricity-every-day/ http://www.forbes.com/sites/timworstall/2013/12/03/fascinati...

kordless 12y ago
I ran the numbers on newer mining rigs a few weeks ago and came up with a PH/s needing about 1 semi tractor trailer engine to run. The network is currently doing about 130PH/s, so that's about 130 semis engines running. Not anything to sneeze about, but also definitely not $15M a day.