by Allex Ferreira
The month of November approaches and with it comes the possibility of a new division (hard fork) in the bitcoin network. The proposal called SegWit2X aims to implement a change in the maximum size of the bitcoin transaction blocks, which could double the processing capacity.
However, SegWit2X has generated controversy among the technical community because this proposal does not have protection against replay attacks.
Before we understand what this is about, we need to talk about how a transaction works on the bitcoin network.
Bitcoin transactions can be similarly thought of as bank checks. The bitcoin network, in turn, is a global book that records the transactions of these checks. As the network is open, anyone can audit it. To do this, simply download the complete copy of the blockchain, that is, the logbook. Bitcoin transactions are also public and anyone can look at the digital signature of a transaction and verify that it is valid.
A division in the network, also known by the technical term hard fork, is an update of the global book of records (blockchain). If everyone updates, the book remains the same. If not everyone does this, we will have two books: the original blockchain and the blockchain that has been updated and branched (forked).
When a network branches, it maintains the transaction history that has occurred until the exact time of its separation from the original network and begins to include the new transaction blocks that happen only on the upgraded network. This was what happened on August 1 with the hard fork of Bitcoin Cash.
If you have funds in the blockchain before splitting into the network, you will have the same amount on both networks after the hard fork. But what if you want to spend coins on one network and do not want to spend on the other?
That's where the problem comes from, because if you spend on a blockchain, someone can copy the same check, which contains your signature, and present it to be included in the blockchain that branched out. That is, they can spend their money on the other network because their signature is valid on both. Of course to whom you are sending the money and the amount must be identical (or the signature will be invalid), but this is still a problem.
The person who is presenting the check copy on the other network is repeating the transaction, ie this is a repeat attack.
Bitcoin Cash solved this problem by changing the check subtly. They have created a special brand that identifies it as belonging to the Bitcoin Cash network and not to the original Bitcoin network. Thus, any computer that is auditing the Bitcoin network will automatically reject the Bitcoin Cash check and vice versa.
This special brand is called replay protection.
The developers behind SegWit2X are refusing to add the replay protection function in code. Instead, they are saying that Bitcoin Core, which is the original Bitcoin developer team, should add protection on its own network if that is a concern.
The problem is that most repeating protections are, by essence, hard network forks. That is, to implement this in the original Bitcoin network, it would be necessary to branch it, creating a version, say, called "Bitcoin original with protection against repetition".
The Bitcoin Core team refuses to do this, mainly due to the lack of time to execute this update and the consequent hard fork that would be generated.
In a hypothetical scenario, if this occurred, we would have: the original bitcoin, the original bitcoin with the protection, the bitcoin cash and the 2X bitcoin. We would have four versions!
There are 45 days left for developers to come to an agreement or not. If 2X really happens and does not have replication protection, users themselves will need to take precautions to prevent potential attacks or have to rely on the goodwill of brokers who will need to develop ways to protect their customers.
The month of November approaches and with it comes the possibility of a new division (hard fork) in the bitcoin network. The proposal called SegWit2X aims to implement a change in the maximum size of the bitcoin transaction blocks, which could double the processing capacity.
However, SegWit2X has generated controversy among the technical community because this proposal does not have protection against replay attacks.
Before we understand what this is about, we need to talk about how a transaction works on the bitcoin network.
Bitcoin transactions can be similarly thought of as bank checks. The bitcoin network, in turn, is a global book that records the transactions of these checks. As the network is open, anyone can audit it. To do this, simply download the complete copy of the blockchain, that is, the logbook. Bitcoin transactions are also public and anyone can look at the digital signature of a transaction and verify that it is valid.
A division in the network, also known by the technical term hard fork, is an update of the global book of records (blockchain). If everyone updates, the book remains the same. If not everyone does this, we will have two books: the original blockchain and the blockchain that has been updated and branched (forked).
When a network branches, it maintains the transaction history that has occurred until the exact time of its separation from the original network and begins to include the new transaction blocks that happen only on the upgraded network. This was what happened on August 1 with the hard fork of Bitcoin Cash.
If you have funds in the blockchain before splitting into the network, you will have the same amount on both networks after the hard fork. But what if you want to spend coins on one network and do not want to spend on the other?
That's where the problem comes from, because if you spend on a blockchain, someone can copy the same check, which contains your signature, and present it to be included in the blockchain that branched out. That is, they can spend their money on the other network because their signature is valid on both. Of course to whom you are sending the money and the amount must be identical (or the signature will be invalid), but this is still a problem.
The person who is presenting the check copy on the other network is repeating the transaction, ie this is a repeat attack.
Bitcoin Cash solved this problem by changing the check subtly. They have created a special brand that identifies it as belonging to the Bitcoin Cash network and not to the original Bitcoin network. Thus, any computer that is auditing the Bitcoin network will automatically reject the Bitcoin Cash check and vice versa.
This special brand is called replay protection.
The developers behind SegWit2X are refusing to add the replay protection function in code. Instead, they are saying that Bitcoin Core, which is the original Bitcoin developer team, should add protection on its own network if that is a concern.
The problem is that most repeating protections are, by essence, hard network forks. That is, to implement this in the original Bitcoin network, it would be necessary to branch it, creating a version, say, called "Bitcoin original with protection against repetition".
The Bitcoin Core team refuses to do this, mainly due to the lack of time to execute this update and the consequent hard fork that would be generated.
In a hypothetical scenario, if this occurred, we would have: the original bitcoin, the original bitcoin with the protection, the bitcoin cash and the 2X bitcoin. We would have four versions!
There are 45 days left for developers to come to an agreement or not. If 2X really happens and does not have replication protection, users themselves will need to take precautions to prevent potential attacks or have to rely on the goodwill of brokers who will need to develop ways to protect their customers.