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On September 9 and 10, the Breaking Bitcoin conference took place in Paris. Unlike Scaling Bitcoin, Breaking Bitcoin did not focus on scaling the Bitcoin network, but mainly on Bitcoin security and related topics. The conference therefore consisted of technical presentations on theoretical and actual attacks and vulnerabilities on the Bitcoin network, Bitcoin users and other forms of resources. A summary of this event by bitcoin.nl.

Breaking and Security

Bitcoin’s value mainly derives from its security, so it must be able to withstand all types of attacks. It is therefore not surprising that Breaking Bitcoin covered a wide range of attack surfaces from different perspectives. These were divided into 5 categories:

• Political, Social and Economic Threats
• Applications: Usability and Security
• Hardware Security
• Protocol Security
• Infrastructure & layer 2

Political, Social and Economic Threats

That Bitcoin is under constant political and economic threat is of course not surprising, but the social threat is relatively new. The Bitcoin Cash hard fork is a clear example of this. With this hard fork, a number of miners and users have split off from the Bitcoin network and introduced an alternative coin called Bitcoin Cash (bcash).

Jimmy Song therefore addressed the hidden costs of a hard fork in his presentation. Think of the increased economic footprint on power consumption, the costs for exchanges (change of infrastructure and auditing of the new software to be run), merchants who had to stop payments and wallet developers who have to support a new currency without loss of privacy/coins of their users. But of course also miners, whose incentives are mainly financial, who therefore switch between different chains that are most profitable for them, resulting in fluctuating confirmation times on both networks.

• Slides presentation Jimmy Song

One of the biggest economic threats in Bitcoin is the insolvency and mismanagement of major players.

The most famous is the MtGox hack, where the bitcoin balances of customers and the actual amount of bitcoins in MtGox’s management were very far apart.

This situation has become a lot more clear in the last few months thanks to WizSec. WizSec’s Kim Nillson presented his analysis of the MtGox hack, the btc-e connection and a historical overview of the solvency issues MtGox has experienced since its inception.

• Slides presentation Kim Nillson

Applications, usability and security

Thomas Voegtlin , the creator of the popular Bitcoin wallet Electrum, covered the risks of a hard fork for SPV/Light wallets. Focusing on the difficulty of recognizing a (hard) fork for SPV wallets, it also went into depth about replay protection, safely separating Bitcoin and Bitcoin Cash. Furthermore, Renaud Lifchitz discussed the network-related attack surfaces of an SPV wallet.

• Slides presentation Thomas Voegtlin
• Slides presentation Renaud Lifchitz

HardwareSecurity

In this part of the conference Nicolas Bacca , the CTO of Ledger, emphasized the security of hardware wallets and the different (technical) methods used to carry out attacks on hardware wallets. He explained how to counter these attacks through trusted computing implementations.

• Slides presentation Nicolas Bacca

Protocol Security

The second day was more about protocol safety. Where Peter Todd took us on a thought experiment. Suppose we have satellites with solar panels: is mining possible in space? A,. Todd drew the parallel between physical distance/latency and the effect of The Great Firewall in relation to having the newest bitcoin block ?????on time???.

Eric Lombrozo talked about a commit from Satoshi. Satoshi accidentally caused this commit to hardfork the network. Using this advantage, Lombrozo emphasized that the importance of a clear protocol definition is essential.

mining security

In this category Eric Voskuil , developer of libBitcoin, touched on the importance of individual miners. Eric emphasized that in reality it is not the cryptography that protects Bitcoin, but the users. Kevin Loaec discussed the usefulness of Proof-of-Work and Proof-of-Stake. Finally, Ricardo Perez-Marco ‘s presentation provided insight into the mathematical model behind a 51% attack and stated that 42% may already be a threat.

• Slides presentation Eric Voskuil
• Slides presentation Kevin Loaec
• Slides presentation Ricardo Perez-Marco

Infrastructure & layer 2

During this portion of the conference, the focus was on the Lightning Network. Surprisingly, an interesting addition to the Bitcoin network was also discussed: Zerolink. Zerolink is a Bitcoin Fungibillity Framework , which combines various anonymization techniques such as CoinJoin, Dandeleon and Mixing. These techniques must ensure that 1 bitcoin has the value of 1 bitcoin, regardless of the history of that bitcoin (fungibility).

The conference ended with the presentation of Amir Taaki. Taaki took everyone through the history of the open source software movement. Finally, Taaki gave his vision for the future and sketched a picture in which bitcoin could serve as currency in small local economies, for example in combination with voucher systems.

• Presentation Amir Taaki
• Slides presentation Amir Task

Conclusion

The first edition of Breaking Bitcoin was a great success. Many prominent players from the Bitcoin development ecosystem were present. An event with a strong focus on safety was something that was needed. This also makes it clear to a wider audience what makes Bitcoin unique and why security is a complicated concept. In addition, it creates strong bonds for cooperation and togetherness. Essential factors that reinforce the correct view of Bitcoin.