Mining pools and the block chain (was: Web of Trust)

goatpig

legendary

Activity: 3766

Merit: 1364

Armory Developer

Quote from: Pygy on May 12, 2011, 10:33:04 AM

So this means that if a pool or several colluding pools manages to get the majority of the mining power for long enough, it/they could mess with the block chain at will?

This gives a huge power to a very small number of persons.

Yes, that is true. There has been a few discussions going on about the size of Tycho's pool regarding this topic.

Pygy

newbie

Activity: 47

Merit: 0

So this means that if a pool or several colluding pools manages to get the majority of the mining power for long enough, it/they could mess with the block chain at will?

This gives a huge power to a very small number of persons.

BitLex

hero member

Activity: 532

Merit: 505

of course its influence on the bitcoin-network IS proportional to its hashing power.

mining-nodes have influence, non-mining-nodes only participate without any influence.

every node verifies blocks that it gets from other nodes, to check if they are valid,
blocks contain hashes (from the previous blocks and transactions), that everyone knows about (because it's written in the blockchain), but non-mining nodes don't need much hashing-power to verify blocks (smartphones work well).
non-mining nodes just don't create any new blocks, they download them as soon as someone else creates them
and you only have influence, if you create new blocks.

Pygy

newbie

Activity: 47

Merit: 0

So this means that the influence a pool (or any node for that matter) on the web of trust is not proportional to its hashing power... Or is it?

What about non-mining clients? Are they verifying hashes?

BitLex

hero member

Activity: 532

Merit: 505

oh, i see.

well, yes, pools are a single node (depending on the pools setup maybe 2, or 3 nodes).

workers, the mining-clients that are connected to the pool, are no nodes at all,
they are just some kind of bruteforcing tool that's hashing some data sent to them by the pool-server.
those workers themselves are in no way connected to the bitcoin-network, they are only connected to the pool-server.
the pool-server then is connected to one, or more bitcoin-nodes.

from a security point of view, pools nodes aren't any different from other nodes,
everyone is treated equally, they either follow the bitcoin-protocol-rules and everythings fine,
or they create their own rules and so create their own network, because everyone else will just ignore them.

Pygy

newbie

Activity: 47

Merit: 0

The web of trust between nodes, that rejects rogue clients trying to double spend or perform other mischiefs.

Or perhaps I missed something?

BitLex

hero member

Activity: 532

Merit: 505

which web of trust exactly are you talking about, that pools should be part of?

i only know about the #bitcoin-otc (which is an irc-channel-marketplace) web of trust,
but that has nothing todo with nodes, or miners, or pools,
it's just individual users that buy and sell bitcoins, or goods or services for bitcoins.

Pygy

newbie

Activity: 47

Merit: 0

Do mining pools act like one node in the Web of Trust?

If so what are the implications from a security point of view?

Also, what's the role of non-mining clients in the WoT?

Topic: Mining pools and the block chain (was: Web of Trust) (Read 1432 times)