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The financial sector's enthusiasm for blockchain technology might be misplaced, according to a pair of Australian distributed computing experts.
The problem: if everyone in a consortium trusts each other, they don't need blockchains to protect themselves; if they don't, current blockchain protocols have a flaw that allows a bad actor to game the system.
The warning comes from CSIRO/Data61 researcher Vincent Gramoli, lead author of an arXiv paper describing what he and colleague Christopher Natoli call "The Balance Attack" (the name comes from one aspect of their attack, that it's deployed against subgroups of nodes with balanced mining power).
In the finance/banking context, Gramoli says the problem is that blockchains are probabilistic, but for something like an inter-bank transfer, you need determinism. If the system enters a state in which it can't guarantee all transactions, downtime is the best solution.
Gramoli told The Reg "if the assumptions are not met, users should get a message that 'the system is not available, please try again later'".
Source: The Register
(Score: 1, Insightful) by Anonymous Coward on Tuesday January 17 2017, @09:06PM
So basically it's a variant of the >50% attack, as described by Satoshi... They add assumptions to it, which are far from real in the current mining ecosystem. If they say it is so easy to perform that attack... have they actually performed the attack? Nope. Right.
(Score: 1, Insightful) by Anonymous Coward on Tuesday January 17 2017, @09:21PM
They're talking about the financial sector which means blockchains that you never get to see and not the current mining ecosystem.