• DOI:10.1145/3419614.3423265
• Corpus ID: 221640654

Defending Against Malicious Reorgs in Tezos Proof-of-Stake

@article{Neuder2020DefendingAM,
  title={Defending Against Malicious Reorgs in Tezos Proof-of-Stake},
  author={Michael Neuder and Daniel J. Moroz and Rithvik Rao and David C. Parkes},
  journal={Proceedings of the 2nd ACM Conference on Advances in Financial Technologies},
  year={2020}
}

• M. Neuder, Daniel J. Moroz, +1 author D. Parkes
• Published 11 September 2020
• Computer Science
• Proceedings of the 2nd ACM Conference on Advances in Financial Technologies

Blockchains are intended to be immutable, so an attacker who is able to delete transactions through a chain reorganization (a malicious reorg) can perform a profitable double-spend attack. We study the rate at which an attacker can execute reorgs in the Tezos Proof-of-Stake protocol. As an example, an attacker with 40% of the staking power is able to execute a 20-block malicious reorg at an average rate of once per day, and the attack probability increases super-linearly as the staking power grows beyond 40%. Moreover, an attacker of the Tezos protocol knows in advance when an attack opportunity will arise, and can use this knowledge to arrange transactions to double-spend. We show that in particular cases, the Tezos protocol can be adjusted to protect against deep reorgs. For instance, we demonstrate protocol parameters that reduce the rate of length-20 reorg opportunities for a 40% attacker by two orders of magnitude. We also observe a trade-off between optimizing for robustness to deep reorgs (costly deviations that may be net profitable because they enable double-spends) and robustness to selfish mining (mining deviations that result in typically short reorgs that are profitable even without double-spends). That is, the parameters that optimally protect against one make the other attack easy. Finally, we develop a method that monitors the Tezos blockchain health with respect to malicious reorgs using only publicly available information.