37,982 research outputs found
A Bayesian Approach to Identify Bitcoin Users
Bitcoin is a digital currency and electronic payment system operating over a
peer-to-peer network on the Internet. One of its most important properties is
the high level of anonymity it provides for its users. The users are identified
by their Bitcoin addresses, which are random strings in the public records of
transactions, the blockchain. When a user initiates a Bitcoin-transaction, his
Bitcoin client program relays messages to other clients through the Bitcoin
network. Monitoring the propagation of these messages and analyzing them
carefully reveal hidden relations. In this paper, we develop a mathematical
model using a probabilistic approach to link Bitcoin addresses and transactions
to the originator IP address. To utilize our model, we carried out experiments
by installing more than a hundred modified Bitcoin clients distributed in the
network to observe as many messages as possible. During a two month observation
period we were able to identify several thousand Bitcoin clients and bind their
transactions to geographical locations
Do consumers need a ‘Bit’ more protection under Australian consumer laws? The regulatory risks and challenges of Bitcoin
The creation of Bitcoin, as a digital currency, has been a significant development in the world of finance, in that it provides an alternative method of payment to consumers and businesses who use Bitcoin as a means to buy or sell goods or simply as an investment arrangement. The use of Bitcoin, as a decentralised peer-to-peer network, provides numerous benefits as a payment system, but at the same time, creates challenges for consumers due to its unregulated nature and volatile status. Therefore, when Bitcoin users enter into agreements with Initial Coin Offering (ICO) hosted companies and Bitcoin exchange platforms, the conduct by these ICOs and exchanges may be misleading and unconscionable in relation to the information they disclose to the Bitcoin user (as a consumer). This paper will consider the application of the Competition and Consumer Act 2010 (Cth) and whether the Australian Consumer Law is suited to take into consideration Bitcoin transactions under the misleading and unconscionable provisions
Bitcoin over Tor isn't a good idea
Bitcoin is a decentralized P2P digital currency in which coins are generated
by a distributed set of miners and transaction are broadcasted via a
peer-to-peer network. While Bitcoin provides some level of anonymity (or rather
pseudonymity) by encouraging the users to have any number of random-looking
Bitcoin addresses, recent research shows that this level of anonymity is rather
low. This encourages users to connect to the Bitcoin network through
anonymizers like Tor and motivates development of default Tor functionality for
popular mobile SPV clients. In this paper we show that combining Tor and
Bitcoin creates an attack vector for the deterministic and stealthy
man-in-the-middle attacks. A low-resource attacker can gain full control of
information flows between all users who chose to use Bitcoin over Tor. In
particular the attacker can link together user's transactions regardless of
pseudonyms used, control which Bitcoin blocks and transactions are relayed to
the user and can \ delay or discard user's transactions and blocks. In
collusion with a powerful miner double-spending attacks become possible and a
totally virtual Bitcoin reality can be created for such set of users. Moreover,
we show how an attacker can fingerprint users and then recognize them and learn
their IP address when they decide to connect to the Bitcoin network directly.Comment: 11 pages, 4 figures, 4 table
A Petri Nets Model for Blockchain Analysis
A Blockchain is a global shared infrastructure where cryptocurrency
transactions among addresses are recorded, validated and made publicly
available in a peer- to-peer network. To date the best known and important
cryptocurrency is the bitcoin. In this paper we focus on this cryptocurrency
and in particular on the modeling of the Bitcoin Blockchain by using the Petri
Nets formalism. The proposed model allows us to quickly collect information
about identities owning Bitcoin addresses and to recover measures and
statistics on the Bitcoin network. By exploiting algebraic formalism, we
reconstructed an Entities network associated to Blockchain transactions
gathering together Bitcoin addresses into the single entity holding permits to
manage Bitcoins held by those addresses. The model allows also to identify a
set of behaviours typical of Bitcoin owners, like that of using an address only
once, and to reconstruct chains for this behaviour together with the rate of
firing. Our model is highly flexible and can easily be adapted to include
different features of the Bitcoin crypto-currency system
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