Selfish mining log 2

Link? The "explanations" I saw were gibberish meant to confuse the non-technical, or shut them up by referring to irrelevant papers

csw [4:43 PM]
All of those are relevant.

LOL
Some of those "irrelivent papers" are used by the authors of SM...

[4:44]
Basically, you know all about network graph theory and you think the terms are _gibberish _

elliotolds [4:45 PM]
it should be possible for you to explain your argument to someone who hasn't studied Bitcoin's network topology specifically

csw [4:45 PM]
Why?

[4:45]
I cannot explain String theory to somebody without knowledge of Physics

elliotolds [4:45 PM]
you can just state your assumptions about the topology

[4:46]
and why it matters

csw [4:46 PM]
And the argument needs to take the network into account.

tomz [4:46 PM]
maybe the question @elliotolds it struggling with is how topology is relevant to a paper that doesn't talk about topology.

elliotolds [4:46 PM]
you haven't explained why

[4:46]
yes @tomz

csw [4:46 PM]
It matters as different systems react and behave very differently

elliotolds [4:46 PM]
@csw that different behavior is rolled up into the gamma parameter

tomz [4:46 PM]
But, maybe we can wait until csw's paper is out? I recall him saying he will publish something like that.

[4:46]
Proof pudding and all that

elliotolds [4:47 PM]
different topologies will result in different gamma

[4:47]
but they start from gamma

[4:47]
so their topology assumptions are baked into that

[4:47]
but what you haven't addressed is why this matters, because their paper works even with gamma as 0

csw [4:47 PM]
And this is what you fail to see, they are not the same. A pruned network is not the same as a full network

elliotolds [4:47 PM]
i.e., even with a topology that is more unfavorable for selfish mining, it will works

csw [4:47 PM]
No, I will get to Gamma 0 later

[4:48]
I am breaking this down one part at a time

[4:48]
And, no, it does not

[4:49]
But, I am not jumping back and forward and further, you do not seem interested in understanding.
I have linked the material. If you want to learn, great, if not, I have no time to teach you.

elliotolds [4:49 PM]
@csw, if you want to actually understand the selfish mining paper sometime, let me know and I'll go over it with you.

csw [4:50 PM]
LOL

tomz [4:50 PM]
maybe the point here is that csw found an extra variable. The network topology, which has not been taken into account by Gün, and it may be relevant to show how it affects the paper.
I'd looking forward to such research.
Topology in Bitcoin is still very much an under-developed subject. (i.e. the code sucks)

csw [4:51 PM]
The SM paper is a web of false assumptions and errors :slightly_smiling_face:

elliotolds [4:51 PM]
@tomz it would only affect gamma though, no? and the paper works no matter what gamma is

csw [4:51 PM]
I used to see this form of work from undergrads when I was teaching stats

[4:51]
No, it does not

elliotolds [4:51 PM]
anyway, i gotta go. csw let me know if you ever decide you're interested in the selfish mining lesson :slightly_smiling_face:

csw [4:51 PM]
Again, you should spend some time on conditional priors.

[4:52]
Let me know if you are open to truth @elliotolds - maybe science and maths?

iang [5:02 PM]
@csw on law - agreed.  I had to unravel my assumptions :slightly_smiling_face:

[5:07]
https://docs.google.com/document/d/1UiMS4Br7LkTIRdEOPjCukOxG6gIdCJTOgXbeOPBHrcE/edit#

[5:11]
hmmm that should be sharable / openable by world.

cypherblock [5:47 PM]
@iang if you are logged into a google account while viewing that page it might reveal your email address. Not sure. but something to be careful of.

iang [5:48 PM]
ah ok.  Yes, it was created with my email address which is [email protected]… which is pretty much public domain now.

cypherblock [5:57 PM]
right I meant for other people following that link. I’m not really sure how it works ,but people could end up revealing their email to others viewing the document at the same time. Maybe test with someone you know.

mwilcox [6:44 PM]
usually it'll leave you as anon. unless you interact / comment

peter_r [7:54 PM]
@csw, @elliotolds: To clarify, I do agree with csw that miners have less incentive to collect witness data under segwit. I still do _not_ understand csw's argument about selfish mining.

elliotolds [7:56 PM]
yes, I agree with the 'less incentive' thing. still think they have plenty of incentive though. plan to reply to your bitcoi.in post with the graphs later today

[7:57]
@mwilcox , are you mwilcox on twitter? any relation to Zooko?

mwilcox [7:58 PM]
That's me but no relation.

elliotolds [8:00 PM]
@newliberty "Paper uses gamma for a low kappa power distribution network" .. can you clarify? The papers shows how the selfish mining strategy changes for any value of gamma. no matter what the network topology is, it will correspond to some gamma value in a real life selfish mining situation. Since the paper tells you how things vary as gamma varies, the results don't depend on the topology. (edited)

daveknightcode [10:56 PM]
joined selfish-mining by invitation from @vlad2vlad

satoshi [10:58 PM]
Bitcoin exhibit one Giant component?


----- Yesterday May 15th, 2017 -----
csw [12:53 AM]
Case 1: Selfish miner (SM)
You return a part of the reward.
The hidden block is _at risk_.
The strategy is a Martingale. The gamblers fallacy in that you mine a block with a part probability of gaining a second.

They forget that quickly broadcasting this block gains a near 100% chance of it being accepted. However, hiding it means that they compete after the fact. You go from 100% to a fraction of the discovered block.

Case 2: No SM
You (nearly) always gain a 100% reward of the first block mined and released. (edited)

csw [1:04 AM]
uploaded this image: image.png
Add Comment

csw [1:13 AM]
IF SM releases on the 15 min point where H1 is expected, they have a fractional chance of a reward. This at Gamma 0 is 2/3.
If SM releases as they discover the block, they have a near 100% of the reward.

They forget that ALL miners working on their block is better.
They have a state diagram that solves every 10 mins on both HM and SM. This is wrong, the difficulty changes only each 2016. That was accounted into the original design.
The state diagrams only make sense for 2x 50% miners.

The state diagrams need to have an expected time for a 1/3rd miner to solve at 30mins a block and a 2/3rd miner at 15 mins.
*Together* these creates a 10 min average.

The system is memoryless. It is like black and red on a roulettle table, 100 reds in a row has no effect on the next red.

The model in the paper is wrong.

csw [1:25 AM]
uploaded this image: Paper 4.2 revenue - part c
Add Comment

csw [1:28 AM]
uploaded and commented on this image: image.png
1 Comment
They treat this as *lossless*.

They have the SM *lose* a block and ignore this. They send *After* the HM and hence  2/3 of the time in their graph model (99.8% on the real version of Bitcoin network) the SM loses and gets:

csw [1:29 AM]
Bitcoin Blocks are not timestampted, first recieved, first mined on.

csw [1:29 AM]
uploaded this image: image.png
Add Comment

csw [1:33 AM]
@peter_r Starting to see this now?

zbingledack [2:37 AM]
Very interesting... :thinking_face:

csw [3:37 AM]
Next and this is what that diagram relates to...

_"The protocol will adapt the mining difficulty such that the mining rate at the main chain becomes one block per 10 minutes on average."_ [2]

Flawed assumption and flawed model.

The state diagram adjusts the main chain to run at 10 mins. The truth is that this is lower. The Honest miners (HM) at a 2/3rd ratio mine at 15 mins (10/[1-(2/3)]) and the Selfish miner at 30 mins (10/[1-(1/3)]) creating more orphans and making the chain take longer until the difficulty adjusts.

The protocol adjusts over 2,016 blocks. This means, that for the numbers of blocks used in the SM paper, the protocol *does not* adjust [1].
[1] https://en.bitcoin.it/wiki/Difficulty
[2] https://www.cs.cornell.edu/~ie53/publications/btcProcFC.pdf - Page 11 (S 4.2) (edited)

[3:39]
The result is that the state diagrams are wrong other than for a selfish miner with > 50% of the hash rate (and they do not need to selfish mine).

zbingledack [3:51 AM]
Hmm...

csw [3:54 AM]
Unless there is comment there, I will close that point off.

Most people do not see the gamma problem, that is simpler than the network either.

Gamma can never be as large as they state. This comes both from the network (that has it close to zero in any case) and simple maths.

If a HM from the 2/3rd of all Honest miners has a pool of 1/3rd of the total power, they will always have 1/3rd of the blocks they mine and will not drop these for the SM ones.

So, there is no case where this can be a gamma of 1 in any case, but the distribution is wrong in any event. That leads to the next point...

csw [3:59 AM]
uploaded and commented on this image: image.png
1 Comment
Equations (6) and (7) are the wrong equations. It does not matter that the maths is fine using these, as they are not the correct formula for conditional probability. This being defined as the probability of an event ( A ), given that another ( B ) has already occurred.

As we have the SM only reacting *after* the release of a block and this being seen by the HM, this becomes the probability of an event (SM releasing), given that another (HM mining a block) event has already occurred.

Equations (6) and (7) are:


[1] https://www.cs.cornell.edu/~ie53/publications/btcProcFC.pdf - Page 11 (S 4.2)

csw [4:00 AM]
In that image - it is displayed earlier... slack...

csw [4:05 AM]
That equation has assumed Statistical independence. This is not the case as they cannot send to 100% of nodes and replace those fromm  the Honest miners. Remember, honest miners will not replace a block for a single block held by the Honest miner already.

So, we have a dependent condition and need to use P(SM | HM).

It cannot be assumed that P(A|B) ≈ P(B|A).

This is a common fallacy. It even has a name. Not taking the *prior probability* into consideration and not negating this from the equation (in part or completely) is refered to as *base rate neglect*. In this series of equations, we have both that and the reverse, _insufficient adjustment from the prior probability_, a fallacy known as statistical *conservatism*.

[4:06]
This is covered in detail as a fallacy here:
http://lesswrong.com/r/discussion/lw/9om/the_conditional_fallacy_in_contemporary_philosophy/
lesswrong.com
"The Conditional Fallacy in Contemporary Philosophy" - Less Wrong Discussion
Split from "Against Utilitarianism: Sobel's attack on judging lives' goodness" for length. Robert K. Shope, back in his 1978 paper "The Conditional Fallacy in

[4:06]
And in the original paper here:
https://www.gwern.net/docs/1978-shope.pdf

csw [4:08 AM]
uploaded this image: image.png
Add Comment

csw [4:09 AM]
Here is a nice little lesson on Bayes theorem and conditional probability:
https://betterexplained.com/articles/an-intuitive-and-short-explanation-of-bayes-theorem/

[4:12]
In the paper they have P(S|H) = P(Case B) +P(Case C) + P(Case G) + P(Case H)

csw [4:13 AM]
uploaded this image: image.png
Add Comment

csw [4:15 AM]
See Kolmogorov, Andrey (1933). Grundbegriffe der Wahrscheinlichkeitsrechnung (in German). Berlin: Julius Springer.

[4:17]
See also:
W. Feller, "An introduction to probability theory and its applications," 1957.

Page 116 - (1.4)

csw [4:18 AM]
uploaded and commented on this image: image.png
1 Comment
For those who do not have a copy of the Feller book:

csw [4:19 AM]
The Selfish miner paper forgot to subtract the intersection probability.

Wrong formula.
Incorrect model
Wrong assumptions.

lunar [5:54 AM]
joined selfish-mining by invitation from @zbingledack, along with @bloomie

daveknightcode [8:16 AM]
wrongs aint wright LOL

csw [8:17 AM]
@daveknightcode ?

Sorry. I do not understand what you are saying?

mwilcox [8:18 AM]
he was just making a joke

daveknightcode [8:19 AM]
it's a joke Dr Wright, we are not "worthy" I salute you LOL

csw [8:21 AM]
Sorry. I am told by my wife that I am a machine or Vulcan...

[8:22]
Maths I get... it is the social aspects of life that pass over me.

[8:22]
I do get pissed off, but the subtle things often elude me :slightly_smiling_face:

daveknightcode [8:23 AM]
I get maths< flip side science to, the hypothesis was created when you drew right in to my catalyst, got a response "yes"?

travin
[8:28 AM]
Pastebin May 14 - May 15 CEST `https://pastebin.com/AH368tD2`


deadalnix [9:22 AM]
As the part that require variable amount of computation is the sighash computation.

[9:22]
woops worng chan

xspdr [11:46 AM]
joined selfish-mining by invitation from @zbingledack, along with @joeldalais. Also, @jcliff joined.

cypherblock [6:18 PM]
@elliotolds was this your program? https://www.reddit.com/r/Bitcoin/comments/1vxszh/selfish_mine_simulation_in_python/ or did you have a different one? I have some questions.
reddit
Selfish Mine simulation in python • r/Bitcoin
Hi All, I made a little code to simulate a selfish mine according to the paper of Eyal and Gün Sirer : "Majority is not Enough : Bitcoin Mining...


elliotolds [6:31 PM]
@cypherblock no, although I compared my results with that one and they were the same

elliotolds [6:54 PM]
for anyone trying to follow along with csw's messages and wondering where he goes wrong: the state machine in the paper already takes into account what happened previously (it's obviously reflected in the current state). csw doesn't seem to realize that if the selfish miner has x proportion of the hash power, then x is always the probability that the selfish miner will find the next block, regardless of who found the last block. similarly, (1-x) is always the probability that the rest of the network will find the next block, regardless of what happened before.

[6:55]
csw claims the paper is assuming that P(A|B) ≈ P(B|A), but csw never says where exactly in the paper he thinks they assume this. the paper does not assume this.

satoshi [7:22 PM]
To my knowledge you have yet to answer what is the network distance in Bitcoin @elliotolds

elliotolds [7:25 PM]
that is true -- assuming in this context 'network distance' means 'longest shortest path between any two nodes', it's irrelevant to the selfish mining paper. all network topology assumptions are wrapped up in the gamma parameter.


cypherblock [7:51 PM]
@elliotolds the issue I have with that python script is that the LongestChainLength ends up at like 7.5m even though 10m time periods take place. Unless I’m counting wrong. Also by my count the selfish miners found 3.5m blocks but only got credit for 3.1m. Basically what I’m trying to figure out is if selfish miners at 35% hash produce more than 35% of blocks it must mean fewer than expected blocks are produced in the chain overall. Right? (edited)

[7:52]
Anyway compare with your script if you have it.

elliotolds [8:07 PM]
yes, that is true. 'eventually confirmed' blocks are found more slowly initially with selfish mining, because there are more orphan blocks. However when the difficulty adjusts after 2016 blocks, this won't affect profits.  So this means that selfish mining is not a good strategy if you do it for just a brief period. the gains come after the difficulty readjustment


[8:08]
aka, the script only shows the profits accurately after the first adjustment

cypherblock [8:24 PM]
yeah but by my counts the selfish strategy fails (using that python algo). They mined a larger % than their hashrate because overall fewer blocks were accepted to the longest chain. They could have gotten rewards for 3.5m blocks but only got rewards for 3.1m blocks. They achieved more control perhaps at the cost of getting less btc. Is that expected here? (edited)

peter_r [8:27 PM]
The point is that 35% hashpower gets more than 35% of the rewards.

[8:28]
Like elliotolds said, it's not profitable until after the diff reset.

elliotolds [8:28 PM]
the thing to keep in mind is that the unit of measure is not # of blocks. after the first adjustment, blocks become easier to find, so total number of blocks that everyone finds will be higher... the relevant measure is "how much value do I get every 10 minutes", and after the adjustment period the selfish miner gets more value per unit time


[8:29]
(total number of blocks that everyone finds == including all the orphaned blocks that selfish mining results in, that never end up in the chain)

cypherblock [8:45 PM]
sorry I must be being dense, but how does difficulty adjustment affect anyone more than others? Becomes easier for everyone to find blocks. % hash power doesn’t change. What am I missing? Miners can always throw away blocks to reduce the difficulty level. I don’t think that pays off.

elliotolds [8:46 PM]
ok, lets say you have 40% of hash power and you're not selfish mining. so you're getting 40% of all block rewards, and rewards come every 10 minutes...

[8:48]
now you start selfish mining. assume gamma = 0.  you will still get 48% of confirmed blocks, but now confirmed blocks are less frequent (maybe every 13 minutes.. haven't done the exact calculation)..

[8:48]
so, at first you're losing money... you get 48% of all blocks but the fact that they come every 13 minutes means you make less than before..  Now, it's been two weeks and difficulty adjusts...

[8:49]
So, blocks are found every 10 minutes again.. and you're getting 48% of them.. hooray, your evil plan worked. congrats..

[8:49]
what step don't you believe?

[8:49]
(obviously, if you continue the selfish mining strategy for long enough, it will more than cancel out the loss you took in the first two weeks)

cypherblock [8:51 PM]
have to eat dinner. I’ll think on this. I don’t recall difficulty adjustment being big part of paper. I will re-read. But it still isn’t clicking for me.

elliotolds [8:51 PM]
it's mentioned as an aside in the paper, they don't focus on it

[8:51]
they're just like 'oh, and difficulty will adjust so this works. moving on..'

peter_r [8:55 PM]
I think the two big things people don't realize about selfish mining are:
1. It is only profitable if maintained for long enough for the difficulty to reset
2. It is _still_ profitable even if you lose all the block races (gamma=0) if you have 1/3rd the hash power

peter_r [8:55 PM]
To me, the model is very simple and I don't see how people can argue that it is wrong.
 2 replies Last reply today at 12:59 AM View thread

peter_r [8:56 PM]
I think you can argue that SM is not a serious threat for a number of reasons, however... (edited)


cypherblock [9:09 PM]
So the claim is that over a long period, say 40,000 minutes, that the selfish miners with 35% hash power (for example) will mine more than 1400 blocks, assuming theirs and all other hash power stays the same? Exactly what is the expected outcome?

peter_r [9:34 PM]
(h^2 (4 + h (-9 + 4 h)))/(1 + h (-1 + (-2 + h) h))

[9:34]
where h is the SM miner's hash rate (assuming gamma = 0) (edited)

[9:34]
This is Eq. (8)

[9:34]
For h = 35%, they win 36.6% of the blocks.

cypherblock [9:36 PM]
So how many blocks after 40,000 minutes (for example)? Sorry % of blocks is not relevant to me unless I want to perform 51% attack, which I don’t. Do you think they will get 1464 blocks like this?

[9:37]
I’m waiting for my :facepalm: moment, but I guess being slow can be helpful sometimes.

peter_r [9:38 PM]
After 40,000 minutes, they'd probably be near break even.

[9:38]
They need to keep the attack going for a long time in order to profit.

[9:38]
The point is that they'd mine 36.6% of the blocks in the longest chain, with only 35% of the hash power.

[9:39]
And once difficulty resets, blocks come every 10 minutes.

[9:40]
So once difficulty has reset, they'd expect to find 1464 blocks over a 40,000 minute period.

[9:40]
But the _first_ 40,000 minute period they will find less.

cypherblock [9:41 PM]
well it better come out to more than 2800 over all then. Is that the claim?

peter_r [9:42 PM]
No, the point is that they can keep it going for as long as they need to to recover their initial losses AND MORE.

2 replies Last reply today at 1:04 AM View thread

cypherblock [9:49 PM]
Ok, so over 80,000 minutes they found less than 2800 blocks, which they could have found via honest mining? But they keep going with selfish mining, and eventually they find more blocks than they otherwise could have? Or do they abandon selfish mining after difficulty adjusts? Sorry I know I’m sounding like I’m being difficult. I want to compare their revenue with selfish strategy vs what they would earn in same time period via honest time period.

[9:49]
So far no example has been given where they make more money than they otherwise could have. (edited)

peter_r [9:50 PM]
The idea is they would continue to selfish mine and continue to reap more rewards than not selfish mining.

[9:51]
As t->infinity, the would earn (36.6/35 -1)*100% = 5% more revenue than not selfish mining. (edited)

[9:51]
For finite t, the earn less. (edited)

[9:52]
t is probably "essentially infinity" after they've kept it up over many difficult adjustments.

cypherblock [9:54 PM]
k. thanks. I will check :slightly_smiling_face:

peter_r [9:55 PM]
:+1:

paperbotAPP [9:57 PM]
joined and left selfish-mining, along with @slinky. Also, @tomothy joined.


----- Today May 16th, 2017 -----
csw [12:23 AM]
The state machine is wrong -this is not a distrete time problem. It is a queuing problem

Wrong system

[12:27]
Also, you are mining in different difficulties... The SM adjusts to be a low hash rate.

[12:28]
You also have a pool...

[12:28]
That is not paying....


cypherblock [12:36 AM]
I’d like to first show that the selfish mining algorithm works as claimed given simplistic assumptions. I haven’t even seen that. Forget the maths. Just trying to simulate. I tried the python program on reddit and all that showed was you could mine 3.1 million blocks mining selfishly but you gave up like .4million additional blocks that could have been published mining honestly, so that doesn’t seem to work. I will try writing my own algo and see if peter_r is correct. (edited)

csw [1:08 AM]
I have some people doing up the nice pretty diagrams
These will be in a presentation I am giving this year

[1:09]
So far, I have given you 1/6 the issues with the model. I am not exaggerating.

[1:09]
And with these issues, you are already seeing the assumptions erode.

[1:10]
I would just hand the maths to people if I could...But that gets me nowhere and we all lose
So, sorry, I need to step you l through very slowly

satoshi [1:11 AM]
Z compiled much of the discussion here: https://steemit.com/bitcoin/@zillionaire/sefish-mining-fallacy-index-updating
Steemit
Sefish Mining Fallacy - Index (Updating) — Steemit
Section A Build Up Part 1 - Background - Part 2 - Q&A - Part 3 - Debate - Section B Math Requirements to… by zillionaire
Today at 4:27 AM


csw [1:11 AM]
I know this is painful, but there is a reason they only let me teach postgrad students and hid me from undergrads :slightly_smiling_face:


[1:12]
The paper never assumes P(A|B) in the state diagram.
That is as the state diagram is wrong.

[1:13]
Next, revenue is not profit.

[1:14]
You are all talking revinue

csw [1:14 AM]
Money earnt is time based
1 reply Today at 1:29 AM View thread

iang [1:14 AM]
@zillionaire has kept notes on this… good to see notes, need to develop into full lesson? … https://steemit.com/bitcoin/@zillionaire/sefish-mining-fallacy-part-1-background
Steemit
Sefish Mining Fallacy - Part 1 (Background) — Steemit
Background Recently on btcchat.slack.com, a private forum was created dedicating "Selfish Mining" topic. Paper:… by zillionaire
Today at 4:21 AM

2 replies Last reply today at 5:15 AM View thread

csw [1:15 AM]
100 BTC in 1 year is not the same as 110 in two

[1:15]
I am sorry, but this is as fast as I can try and unlearn things from you...

satoshi [1:17 AM]
i just linked to the overarching index above @iang

iang [1:19 AM]
oh ok, I shut up now, in a bayesian way


newliberty
[1:26 AM]
If we wanted to be extremely strict with ourselves, Is the Bitcoin network truly neither purely Poisson nor power law, and not random either?

csw [2:39 AM]
Oh... I know exactly what it is...

[2:40]
It is ER in first release, power law in competition.
SEIR-C

csw [2:58 AM]
@cypherblock
This is the FIRST of 6 flaws.... Right now you are already starting to see problems.

Wait... it gets way worse.

csw [3:19 AM]
Next.... "the garden of forking paths". A Bayesian concept.

[3:21]
Here is a simplified write-up
http://models.street-artists.org/2017/04/07/a-bayesian-understanding-of-the-garden-of-forking-paths/

[3:21]
Laplace never understood this either... So I do not fault people for failing to grasp it.

[3:22]
So. today's reading
http://www.stat.columbia.edu/~gelman/research/unpublished/p_hacking.pdf

[3:24]
And simple a read
http://andrewgelman.com/2016/01/04/plausibility-vs-probability-prior-distributions-garden-forking-paths/
Statistical Modeling, Causal Inference, and Social Science
Plausibility vs. probability, prior distributions, and the garden of forking paths - Statistical Modeling, Causal Inference, and Social Science
I’ll start off this blog on the first work day of the new year with an important post connecting some ideas we’ve been lately talking a lot about. Someone rolls a die four times, and he tells you he got the numbers 1, 4, 3, 6. Is this a plausible outcome? Sure. Is is probable? …
Jan 4th, 2016 at 9:41 AM

joeldalais [4:50 AM]
https://en.wikipedia.org/wiki/Gambler%27s_fallacy (edited)

csw [4:59 AM]
Yes. and worse.

mwilcox [8:21 AM]
https://twitter.com/el33th4xor/status/864350638930485249
Emin Gün Sirer @el33th4xor
Interesting. @ittayeyal, grab some popcorn and take a look, there's a new comedy show. https://twitter.com/Satoshi_N_/status/864346134377975809
TwitterToday at 1:23 AM
 !Satoshi Nakamoto @Satoshi_N_
Selfish Mining Fallacy - Index https://steemit.com/bitcoin/@zillionaire/sefish-mining-fallacy-index-updating https://pbs.twimg.com/media/C_7FzzbXoAAYRhx.jpg
TwitterToday at 1:05 AM (169kB)

csw [8:54 AM]
Yes. I am writing the complete paper.

[8:54]
Poor Emin... he decided.


midnightmagic [9:10 AM]
joined and left selfish-mining. Also, @fatman3001 joined, @pesa joined, @darius joined, @checksum0 joined, @mba88 joined, @zarry joined, @klee joined, @allegro101 joined.

tomothy
[9:12 AM]
I added a slew of you for some more detailed reading. Back to lurking here.


shinobimonkey [10:36 AM]
joined selfish-mining by invitation from @bitsko

joeldalais [11:04 AM]
uploaded this image: topology+sm.png
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joeldalais [11:04 AM]
updated the image i made the other day to include selfish mining

csw [12:19 PM]
_"Bitcoin system, we characterize how the threshold varies as a function of message propagation speed in the network.”_
·       There has been no analysis of the message propagation speed or format within this paper. The authors state they have done this and yet clearly model a system that has no relationship to the inter-connectivity within bitcoin nodes.

·       They extend to comments such as the following that do not even act as conclusions to the fallacious models and data that have been presented later in this paper:

o   “This implies that, if less than 100% of the miners are honest, the system may not be incentive compatible: The first selfish miner will earn proportionally higher revenues than its honest counterparts, and the revenue of the selfish mining pool will increase superlinearly with pool size.”

o   The network gamma in bitcoin has been incorrectly modelled. The authors simply pull figures out of the hat based on a presumption of Sybils and their affect within a power law graph. Unfortunately these are completely unrelated to bitcoin and the network model expressed within that network.

o   Even taking this into account, _it is crucial to note that under one third of network power even expressed in the selfish mining model is not only of the lower profitability then honest mining but delivers a lower revenue and increased cost_.

o   Figure 2 in their paper demonstrates that any mining pool with less than 30% of the hash rate can never hope to get even the revenue of a standard mining strategy. The result of this is at a greater cost. The selfish miner loses guaranteed blocks in an attempt to gain more in a Martingale strategy.

o   This itself is a cost. In addition to this, running Sybil nodes requires additional virtual machines all of which could either deliver a profit in other uses or not be hired in the first place. The systems need to be managed and maintained. This is a further cost that is not taken into account. In this only addresses the revenue model.

o   We will also detail later in the system the flaws associated with treating the selfish mining strategy as a discrete time process. All poison processes of this type are based on continuous time analyses. The theory used here is known as queueing theory. When applied correctly, the authors assumption of the same number of blocks being mined is shown to be false. We detail this later in this paper.

·       A strategy that requires higher cost investment for a lower expected revenue is not one that would attract rational investors. Rational investors are driven towards profit. This seems to be a common misapprehension held by many people within the bitcoin community. This inability to understand the difference between revenue and profit has had many dire consequences and negative effects already.

. (edited)

[12:20]
*“The blockchain is maintained by a network of miners, which are compensated for their effort in Bitcoins.”*
·       This demonstrates a subtle error associated with the nature of money and wealth. A mining reward is allocated, however the nature of the compensation to each miner is oversimplified here.

·       Miners are not compensated, they compete. This is a key fundamental difference that the authors of the selfish mining paper have not fully understood. They do this at cost to themselves in the hope that they will profit from the difference in the cost associated with gaining revenue and the amount that they can sell or trade bitcoin for on the market.

·       All money is traded. Money is not a consumption good. We either trade it for other forms of currency author goods and services that we seek to consume. As such, a part of this compensation that they claim to be allocated is the profit that each miner individually manages to create through their own efficiencies. (edited)

zbingledack [12:40 PM]
Though it seems it should be obvious if the paper failed to account for costs?

csw [12:42 PM]
Revenue..

[12:42]
One of the MANY flaws...

[12:43]
They equate revenue to profit. The add systems, increase costs and assume that the profit just increments with costs....

This is what happens to academics who have never run a company.

[12:45]
Page 2:
_*"Because the protocol was believed to reward miners strictly in proportion to the ratio of the overall mining power they control, a miner in a large pool was believed to earn the same revenue as it would in a small pool."_*

_"it can be used by a minority pool to obtain more revenue than the pool’s fair share"_

zillionaire [12:46 PM]
Just a comedy show

csw [12:46 PM]
No, Gun knows more than me. He said so in no uncertain terms.

I am certain he is correct. More revenue just makes profit... I saw that and learnt it from the underware Gnomes... :slightly_smiling_face:


[12:47]
https://www.youtube.com/watch?v=tO5sxLapAts
YouTube Ryan Holota
South Park Underpants Gnomes Profit Plan



zillionaire [12:47 PM]
https://steemit.com/bitcoin/@zillionaire/selfish-mining-fallacy-debate-ii
Steemit
Selfish Mining Fallacy - Debate II — Steemit
"Bitcoin system, we characterize how the threshold varies as a function of message propagation speed in the… by zillionaire
Today at 7:24 PM


[12:49]
Better publish the paper man.

joeldalais [12:49 PM]
maybe they might understand it better as net and gross

csw [12:49 PM]
It is coming :slightly_smiling_face:


[12:49]
"Once a selfish mining pool reaches the threshold, rational miners will preferentially join selfish miners to reap the *higher revenues* compared to other pools."

Not profit, turnover.

newliberty
[12:52 PM]
The most successful mining operations today are not those in "data-centers", they are the ones in tin shacks in the mountains next door to the hydro-electric plants that were built to power cities that are not yet occupied.
ALL of the competition is on the cost side of the GL. (edited)

csw [12:52 PM]
uploaded and commented on this image: image.png
2 Comments
Next:

" Bitcoin that ensures that *pools smaller than 1/4 of the total mining power* cannot profitably engage selfish mining. "

zillionaire [12:52 PM]
Coming soon TM

csw [12:53 PM]
I know when, I just cannot say right now :stuck_out_tongue:

zillionaire [12:53 PM]
When TM

csw [12:53 PM]
In the image above, I have removed Gamma =1.0 (as a 75% of the network is NEVER gamma = 1 even with 1,000,000 million Sybils per miner...

[12:55]
*NOTE:*

The SM strategyu EVEN with all the flaws is NOT even revenue positive (let alone profitable) for miners with lower than 25% of the network hash power and they state it needs to be changed...

zillionaire [12:55 PM]
commented on csw’s file image.png
Your ms. Paint editing never changes lol.

newliberty
[12:57 PM]
https://www.youtube.com/watch?v=IhJQp-q1Y1s
YouTube Dangerdan
Monty Python, The Fish Slapping Dance


csw [12:57 PM]
_" We offer a backwards compatible modification to Bitcoin "_

This is what it is all about. Stuff whether it is true or works, they want to change it :slightly_smiling_face:

[1:00]
_"Yet, since the current protocol has no guaranteed lower bound on this threshold, it cannot automatically protect against selfish miners."_

It is called profit.

Like many academics who have not worked in the real world, they fail to understand this.

Revenue is what matetrs, it is what you can claw away from others in grants and the like and it does not require that you manage it wisely. Hence one of thr many flaws in this paper.

newliberty
[1:02 PM]
Unprofitable systems are inherently unsustainable, they can only grow through parasitism.

[1:02]
Once the host dies, they die.

csw [1:03 PM]
From the conclusion it is clear, more revenue share (that is not more money, but taking away more from others EVEN if everyone earns less) is profit to them.


newliberty
[1:04 PM]
Prisoner dilemma in reverse

csw [1:04 PM]
They also talk not of total increase revenue, but of revenue share.

[1:06]
Even in what I have started people modeling now, you see that there are more lost blocks and orphans, this reduces the total earnings. The revenue is lower over a set period of time (they treat this as a discrete time system when it is not).

[1:10]
At 49% the presented model provides 100% of mining rewards to the Selfish Miner.

There is a 3% chance that a Honest miner will start with 5 blocks in a row. There are many other instances where the selfish miner at this level flip flops one block after another with the honest miner.

These scenarios all provide revenue returns to the honest miner, the SM is not reversing blocks.

Yet, somehow... they manage with 0 gamma (and 51% of the network = 51% gamma just to themselves in this wrong model).

They are saying, those blocks are not revenue when they clearly are....

Opps.

csw [1:11 PM]
uploaded this image: image.png
Add Comment

csw [1:12 PM]
This is it here....

Did they mix "relative pool revenue" with TOTAL pool earnings....

[1:12]
Even at 50% you do not earn 100% of blocks :wink:

[1:13]
Oh, and it gets better....

If you BOTH have a 50% selfish mining strategy... the model leaves you BOTH with 100% of the network!

newliberty
[1:24 PM]
EBITDA...and costs.

csw [1:26 PM]
_"But a savvy pool operator can perform a sybil attack on honest miners by adding a significant number of zero-power miners to the Bitcoin miner network"_

For an Erdos Renyi graph of the distance and radius of Bitcoin, you will need around 1 million Sybil nodes for each real node.

That comes to around 1 Billion virtual machines. (edited)

newliberty
[1:28 PM]
Not so savvy after all.  Even using a botnet, there are opportunity costs.

csw [1:28 PM]
That is a HUGE botnet

[1:31]
For on demand pricing (excluding costs to maintain and run) this comes to $0.0059USD an hour.

Only 141,600,000 USD a day at current costs...

newliberty
[1:32 PM]
Volume discount? lol

csw [1:33 PM]
How many million hosts for each staff member?

zillionaire [1:34 PM]
Can't use C&C?

csw [1:34 PM]
Oh... but it is also secret, nobody can know that you are spending 1 billion a week to attack Bitcoin so you can make 3-4% profit...

Then, I would not want anyone to know that I was as stupid as it would be needed to be to do this.

[1:34]
Even a C&C cannot do so many.

[1:35]
A 20 million bot C&C I was involved with stopping had 120 staff (over in the East of Europe)

zillionaire [1:36 PM]
(Don't mention ipv6, he will brag his ipv6 range)

csw [1:36 PM]
:stuck_out_tongue:

[1:37]
I have an Autonomous System Number too :stuck_out_tongue:

zillionaire [1:37 PM]
Damn NL, you just opened a can of worm

[1:38]
Bragging time, 1 2 3 go ... start a sentence with "I have ..."

csw [1:40 PM]
I have a video game that I am going to play


csw [1:52 PM]
_"In this section, we argue that the current Bitcoin protocol has no measures to guarantee a low γ."_

Well, actually, it does. The system already maintains a low gamma and they err in what impact a Sybil node has - again, they did not model the network topography. In fact, when I mention this, I am told that the network is "not assumed in the paper". No, it is not assumed, it is not tested and it is unknown. The authors just do not bother with empirical data or rigor. They assume it is different to what it is and that it must be fragile.

But why test the system? It is easier to spread doubt.

PS. I believe that people in here stated this as well... (edited)

[1:55]
_"The random peer-to-peer structure of the Bitcoin overlay network will eventually propagate X to all miners, but the propagation of X under these conditions will be strictly slower than that of block P"_

See, here is the thing... The authors *DID* assume a network structure.... Just the wrong one.

csw [2:12 PM]
_"Recall that these events occur at exponential intervals with an average frequency of α and (1−α), respectively"._

Ummm. No. Wrong...

If α=1/3, (1-α)=2/3

The related time for α is:
 E(α) = 10 min/α = 30 mins
 E(1-α) = 10 min/(1-α) = 15 mins

Just a minor error...

The system state would even be ok... if it was independent... A shame it is not.

What the authors of the paper have done is to use the simplified model:
https://www.cs.utexas.edu/users/browne/cs380ns2003/Papers/SimpleQueuingModelspdf.pdf

In this simple model, we have independent events. Yes, hash rate is not dependent, but the strategy is. I know this seems count-intuitive and difficult, but when you have conditionals, you cannot treat them as being independent.

Where we have competing queues, we have a different model.
"Two Competing Queues with Linear Costs and Geometric Service Requirements: The μ cRule Is Often Optimal"
Author(s): J. S. Baras, A. J. Dorsey and A. M. Makowski
Source: Advances in Applied Probability, Vol. 17, No. 1 (Mar., 1985), pp. 186-209
Published by: Applied Probability Trust
Stable URL: http://www.jstor.org/stable/1427059
Accessed: 15-05-2017 19:43 UTC
jstor.org
Two Competing Queues with Linear Costs and Geometric Service Requirements: The μ c-Rule Is Often Optimal on JSTOR
A discrete-time model is presented for a system of two queues competing for the service attention of a single server with infinite buffer capacity. The service ...
(edited)

[2:15]
I guess that they also do not understand that two events CAN occur in rapid succession. It is random. You cannot simply assume it is negligible and ignore it. That is not how probability calculations are made.

That means that a single hop state diagram is wrong.

Miners will mine for blocks and can find them in succession. It is infrequent, but needs to be a part of a valid model. (edited)

csw [2:48 PM]
The system is modelled as a discrete-time process where it needs to be a continuous-time process.

[2:52]
Oh and - as I said, the Maths is *WRONG*

Did you still do your models using it?

https://arxiv.org/pdf/1311.0243.pdf
Page 17 - A1

csw [2:52 PM]
uploaded this image: image.png
Add Comment

csw [2:54 PM]
This is a Poisson process...

csw [2:54 PM]
uploaded this image: image.png
Add Comment

zillionaire [2:54 PM]
You are shaming their PhD ...

csw [2:54 PM]
I have one as well.

zillionaire [2:54 PM]
This is junior math

[2:54]
And like year 2 of actuary major

csw [2:55 PM]
uploaded this image: image.png
Add Comment

csw [2:57 PM]
It is *not* a discrete time system.

[2:59]
Assume that N1(t) and N2(t) are independent Poisson processes with rates λ1 and λ2.

But... these are *NOT* independent...

csw [3:06 PM]
P[SM=X+2 ∣ HM=X] =[ P[(SM=X+2)∩(HM=X)]] /P[SM=X]

*NOT*..

P[SM=X+2 ]

zillionaire [3:09 PM]
i wish you put together what you wrote here as a latex paper

csw [3:09 PM]
*"From 0’, there are three possible transitions, all leading to state 0 with total frequency 1:"*

Again, it is not a discrete independent process.

[3:09]
I have

[3:09]
There are three papers already written :slightly_smiling_face:

[3:10]
And more to come... They are being released soon.

zillionaire [3:10 PM]
then publish them, what is the bottleneck of publishing?

csw [3:10 PM]
Gun used a small conference...

[3:10]
Quick and dirty. Little in the way of real checking.

zillionaire [3:12 PM]
I can make a big conference in Vegas featuring whatever if you like

[3:13]
Wynn or Casears lol, take a pick.

csw [3:13 PM]
We denote by γ the ratio of honest miners that choose to mine on the pool’s block


Think....

_"(2) the others mine a block on the previously private branch (frequency γ(1 − α))"_

Gamma = ?

zillionaire [3:13 PM]
red carpet, rolling papers from gate to main podium

csw [3:13 PM]
No US. And Journals

[3:15]
Gamma is between 0 and 1

elliotolds [3:15 PM]
not publishing the papers could also be a delaying tactic. it's easier to convince non-technical people if the papers are "coming soon" and never exposed to criticism... just like csw said that proof that he was satoshi was "coming soon" on his website, then never published it (edited)


csw [3:16 PM]
:slightly_smiling_face:

Yes, that is it.

elliotolds [3:16 PM]
just a hypothesis :slightly_smiling_face:

csw [3:16 PM]
There are people on here that know dates..

[3:16]
Yes, just as good as the ones in the paper as well...

joeldalais [3:17 PM]
i don't know dates, but the stuff does make sense, you just need to know the network topology properly

csw [3:17 PM]
Those where better hypothesis's than yours :slightly_smiling_face:

elliotolds [3:17 PM]
joel, what is your technical background?

joeldalais [3:17 PM]
a bit of this a bit of that, computer science, economics and law

[3:18]
but nowhere as indepth as csw

[3:18]
and sociology, but that's not relevant

elliotolds [3:19 PM]
have you worked as a professional software developer? (if so, i think you might be the first plausibly technical person to agree with csw on 'topology isn't folded into gamma')

csw [3:20 PM]
uploaded this image: image.png
Add Comment

joeldalais [3:21 PM]
i've done a bit of coding, taught myself mostly when younger (and designed a basic game), but forgotten most of it now. But to understand bitcoin you need to understand more than just programming.

zillionaire [3:21 PM]
sociology like criminal justice?

joeldalais [3:21 PM]
yes

elliotolds [3:22 PM]
sure, but to understand why topology is folded into gamma you just need to have a somewhat technical mind.

joeldalais [3:22 PM]
you saw my diagrams?

[3:22]
this is what the network of bitcoin should/does really look like

csw [3:22 PM]
@elliotolds I guess that you did not know that in conditional Poisson processes, you do not get to just average the values as a discrete time event...No, I would guess that,

joeldalais [3:23 PM]
not saying i'm an expert, just my interpretation to others

elliotolds [3:24 PM]
csw, you're saying if you have x proportion of hash power, the probability that you'll find the next block is not x, but depends on what happened previously?


[3:25]
if so, what specifically is the probability that you find the next block, given that (a) you just found a block 30 seconds ago, and (b) the rest of the network just found a block 30 seconds ago? i still don't know what exactly you're claiming about those probabilities

csw [3:25 PM]
In the SM paper - yes

elliotolds [3:26 PM]
i'm not asking about the SM paper specifically, just in general.. if you have x hash power, what's the probability that you find the next block and what does it depend on? (the standard answer is: it's x, and it only depends on x)

csw [3:26 PM]
It is not the probability of the next in an independant chain, it is the proability of gaining a block before another does given that you respond and release after an event.

joeldalais [3:27 PM]
it only occurs if you SM

csw [3:27 PM]
@elliotolds
Different questions have different answers.

elliotolds [3:27 PM]
csw, so you admit that the probability of finding the next block, (just that probability) is x?

csw [3:27 PM]
I say that the probability of a time dependent event is not the same as an independent one

[3:28]
But, you clearly have no knowledge of this.

zillionaire [3:28 PM]
Loss Model book by Ross covers most of topics here.

[3:28]
ah, not from Ross
https://www.amazon.com/Loss-Models-Decisions-Stuart-Klugman/dp/1118315324

[3:29]
this book covers every topic here

elliotolds [3:29 PM]
then what is the probability of finding the next block, if you have x proportion of hash power? can you give me a concrete math expression?  if it depends on another factor, you can say "it's different if the other factor is Y, vs if the other factor is Z", and that will be enough

csw [3:29 PM]
@elliotolds does not understand the difference in Probability theory with respect to dependent and conditional and hence independent events.

elliotolds [3:30 PM]
@csw, so you refuse to answer?

csw [3:30 PM]
No, you refuse to accept

joeldalais [3:30 PM]
he has answered though...

elliotolds [3:30 PM]
accept what?? (haven't seen an answer)

joeldalais [3:30 PM]
:confused:

csw [3:30 PM]
Your failure to understand basic probability theory is your failing.

peter_r [3:30 PM]
Can anyone concisely explain yet csw's argument that Eyal and Sirer's model is wrong?

elliotolds [3:31 PM]
your "answer" is some vague claim that we need to take into account dependent/conditional events. i'm asking what the probability is

zillionaire [3:31 PM]
@peter_r  wrong model and wrong assumption

csw [3:31 PM]
I have not finished @peter_r

You have flaws and we are only 1 of 6 assumptions through

elliotolds [3:31 PM]
@zillionaire that's not a concise explanation, but a very vague claim

peter_r [3:31 PM]
Most people already agree that the model is too simply to reflect reality.

zillionaire [3:32 PM]
@elliotolds  talk to tyou later, gotta go

csw [3:32 PM]
No, using an independent Poisson equation where it is not independent - well that is a very clear answer.

elliotolds [3:32 PM]
@zillionaire be sure that you or whoever has been archiving these chats put this one up on steemit too. people will be interested in seeing csw refuse to answer this question.

csw [3:33 PM]
LOL
No, @elliotolds you failing to comprehend

peter_r [3:33 PM]
For example, I don't think SM is a concern because:

(1) It assumes that only one mining cartel is selfish mining and that everyone else will just stand around and let it happen.

(2) It assumes that the SM will be able to continue the attack for several difficulty periods in order to recoup his initial costs of starting the attack.

(3) It assumes no members of the SM cartel "sell out" and release their blocks when it benefits them but hurts the SM cartel.


csw [3:33 PM]
uploaded this image: image.png
Add Comment

elliotolds [3:34 PM]
it might be easier to comprehend after you give an answer

csw [3:34 PM]
That is a single state in the model

peter_r [3:34 PM]
But so far I haven't seen any evidence that SM is "wrong" given the assumptions of the model.

csw [3:34 PM]
Not that simple BS they state

[3:34]
The model is wrong

peter_r [3:35 PM]
Sure, for example I gave 3 reasons above why it is "too simple."

[3:35]
We already know this.

csw [3:35 PM]
@peter_r - You would have done a little probability theory as a Physicist...

elliotolds [3:35 PM]
the assumptions of the model are wrong, or the paper derives the wrong conclusion from their model?

csw [3:35 PM]
All of the above.

peter_r [3:35 PM]
I still have no idea what argument you're actually making.


csw [3:35 PM]
Assumptions, and conclusion

[3:36]
@peter_r

What is the probability of a Poisson even occurring given another has occurred?

peter_r [3:36 PM]
The probabilities are independent.


csw [3:36 PM]
No, they are not

[3:37]
They are only independent when there is no condition

peter_r [3:37 PM]
Go on...

csw [3:37 PM]
The model is based on a conditional response.

[3:37]
SS| not.H

[3:38]
SSS | not HH

[3:38]
SS | H

[3:38]
etc

peter_r [3:38 PM]
The probability of solving a block between time t and t+dt does not depend on whether anyone else has recently solved a block.


csw [3:38 PM]
P(SS | Not.H) =/= P(SS)

[3:38]
There is no time set

[3:39]
Flawed, it is a continuous time system

[3:39]
It is treated as a discrete system

[3:39]
"The probability of solving a block between time t and t+dt does not depend on whether anyone else has recently solved a block."

The hiding and release of blocks does....

zbingledack [3:40 PM]
"What is the probability of a Poisson event occuring given another event has occurred?"

This looks like it could be interpreted in a slightly different way. Possible to reword for clarity?

peter_r [3:40 PM]
I think I'm just going to have to wait for the paper.  I've been following this thread for days and nothing is getting any clearer.

joeldalais [3:40 PM]
"The hiding and release of blocks does...." <-- that bit, it always adds on a constant

[3:40]
to selfish mining

elliotolds [3:40 PM]
hiding and releasing has no impact on the probability of finding the next block. that's a strategy built at a higher level than the question of who will find the next block


[3:41]
i will also "wait for the paper", unless csw can convince even a single technical person that he's right on this point. so far he has convinced 0 as far as I can see.

csw [3:41 PM]
Actually it does in that you have a block and the reward is dependent. Sorry, you are just demonstrating what little you understand in probability theory.

zillionaire [3:41 PM]
From that I have lurked so far, csw found mistakes in prob models Emir Gun used, which resulted in wrong Conclusion

elliotolds [3:43 PM]
(or unless other people have questions about selfish mining, like @cypherblock , happy to continue helping those trying to figure it out for themselves)


zbingledack [3:43 PM]
Is it something like the "t" ends up being cherry picked in a way, as a "starting time"?

[3:43]
(Discrete vs. continuous time)

csw [3:45 PM]
@elliotolds You get to wait :slightly_smiling_face:

zillionaire [3:45 PM]
It is basic prob

[3:45]
If you have sometimes, please check Loss Model book or Prob Theory by Ross. Amazing books covered all of your questions here

elliotolds [3:46 PM]
btw, does anyone want to bet on the reception of csw's paper? (it could be as simple as betting on whether @peter_r will agree with csw after he publishes his paper that "P(SS | Not.H) =/= P(SS)")

csw [3:46 PM]
LOL

[3:46]
I will make a bet...

[3:46]
100 BTC

[3:46]
:slightly_smiling_face:

zillionaire [3:46 PM]
Short it

[3:46]
Short this bet mferrr

[3:46]
100x bitmex

elliotolds [3:46 PM]
held in escrow in a 2 of 3 multisig? by luke_jr :slightly_smiling_face:


csw [3:47 PM]
LOL

new messages
[3:47]
Like giving a gun to a baby

elliotolds [3:47 PM]
off to the gym, let's work out the details of the bet later

joeldalais [3:50 PM]
its just how the system works, the honest miner always starts earlier (than the sm) if the selfish miner is holding back a block (edited)