Preface

It looks a silent revolution, bitcoin technology spreading to the world. Even though government unsupported this financial tool and proprietary financial firm not accept this technology.
But he is valid in the finance and investment market. As a matter of fact, the activities running strong today (7th Aug 2017).

Our earlier study on block chain technology motion

Comparison table:

Rouge-et-noir , they are all going to achieve this objective (blockchain or Hyperledger)

The maturity business model of bitcoin today

The fundamental design concept of bitcoin improvement program are based on vote or user input. And therefore Bitcoin is not controlled by any single entity or company. Whereby an improvement program framework has been introduced. It is so called BIP (Bitcoin Improvement Proposal).

Remark 1: A Bitcoin Improvement Proposal (BIP) is a design document for introducing features or information to Bitcoin. The BIP should provide a concise technical specification of the feature and a rationale for the feature. This is the standard way of communicating ideas since Bitcoin has no formal structure. The first BIP (BIP 0001) was submitted by Amir Taaki on 2011-08-19 and described what a BIP is?

Proposal 91

Upcoming Bitcoin activation of Bitcoin Improvement Proposal 91 (BIP 91). Bitcoin Improvement Proposal 91 (BIP 91, also known as Miner Activated Soft Fork) recently locked in over 90 percent of all mining hash power, signaling majority support for this proposal. BIP 91’s lock in effectively makes BIP 148 (User Activated Soft Fork scheduled for August 1) obsolete and discard the chances of the Bitcoin network forking through UASF (User Activated Soft Fork). What is the reason to nullifies UASF?

Bitcoin Possible Crisis, User Activated Soft Fork(UASF BIP-148)-Vulnerability encountered CVE-2017-9230

For more details about the vulnerability, please refer below url for reference

https://cve.mitre.org/cgi-bin/cvename.cgi?name=CVE-2017-9230

Bitcoins tell the world,  sunrise is on the way.

The Bitcoin Improvement Proposal (BIP) expect to meet the goal on 1st August 2017. The goal is launch of a new coin and Bitcoin Cash (BCC). These coin should include strong replay protection. All you need to do to be able to access your BCC is control your bitcoin (BTC) private keys on this day.

BIP 91 objective – BIP 91 requires 80% of the coin miners to support. Besides, it require to locking  SegWit2x’s (SegWit) update on 1st August 2017.

Remark 2: SegWit was proposed by Bitcoin Core volunteers to increase network capacity and solve transaction scalability through soft folk on 2015.

Remark 3: SegWit2x (BTC1): Supported by miners and start-up companies, the proposal aims to develop SegWit through a soft fork.

Breakthrough – below voting status shown that BIT 91 receive miner fully support

Summary:

As of today, bitcoin looks running strong in the market. We keep our eye open see whether any unforeseen matter happen in coming month.
……..in deo speramus

Preface

What is Achilles heel: a small problem or weakness in a person or system that can result in failure. If you familiar with Chinese Kung Fu,  the key word “achilles heels” you might not feeling unfamiliar.

Wake the world attention – Ethereum security incidents

Jun 2016 –  Decentralized Autonomous Organization (DAO) attack – Code Issue Leads to $60 Million Ether Theft

Jul 2017 – South Korea’s largest Bitcoin/Ethereum cryptocurrency exchange ‘Bithumb’ hacked and over $1 Million in cryptocurrencies stolen

Ethereum claimed itself that he is the most Secure Public Blockchain. He is on the way overtaking Bitcoin technology. But what’s the key factor causes cyber security incidents happened in past?

The technical weakness summarized below:

1. The Ethereum network itself might not vulnerable. “DAO” stands for “Decentralized Autonomous Organization”. It’s basically a type of application (a smart contract system) that can be deployed on the Ethereum network/blockchain. The hacker took advantage of a vulnerability in the contract code, written in the JavaScript allows a single participant to “drain” Ethereum tokens from the collected pool of all the investor money to a separate personal pool, which “the attacker” can then use by himself.
2. A warning about the mempool transaction replacement mechanism.Implementors should take this into account and try to create contract mechanisms that do not rely on mempool replacement if they wish to have their implementations work with current implementations.
3. Large Hashrate Pools Accidental suspend the services. Pools with larger hash-rates have recently been using the built in feature to only process their nodes own transactions. High volume of transaction which waiting for confirmation will slow down the performance of the pool causes services suspended.

Sample survey – in regards to cyber security incidents in the past

Investigation step 1 – Does Ethereum client have memory pool?

Yes, similar concept of memory pool definition will be valid in client side. The similar function  is for keeps transactions like Bitcoin’s mempool. The naming convention of the key term is the Transaction Pool, or TxPool in the code (see below)

var (
    // Transaction Pool Errors
   ...
)

const (
    maxQueued = 64 // max limit of queued txs per address
)

...
// TxPool contains all currently known transactions. Transactions
// enter the pool when they are received from the network or submitted
// locally. They exit the pool when they are included in the blockchain.
//
// The pool separates processable transactions (which can be applied to the
// current state) and future transactions. Transactions move between those
// two states over time as they are received and processed.
type TxPool struct {
    quit         chan bool // Quiting channel
    ...

Inherent risk & design limitation

i. Transactions may reverted

Ethereum Virtual Machine (EVM Level)

Python – If C calls D.foo(), and foo does a throw ((bad jump, out-of-gas, or any other exception), as a result the entire transaction reverted.

Known bug bug in geth v1.4.19 and v1.5.2 – Geth was failing to revert empty account deletions when the transaction causing the deletions of empty accounts ended with an an out-of-gas exception. An additional issue was found in Parity, where the Parity client incorrectly failed to revert empty account deletions in a more limited set of contexts involving out-of-gas calls to precompiled contracts; the new Geth behavior matches Parity’s, and empty accounts will cease to be a source of concern in general in about one week once the state clearing process finishes.

Remark: out of gas definition – The gas cost can only be estimated until the transaction is executed against the actual contract state at the time of execution on the blockchain. If the transaction run out of gas before transaction complete. EVM exceptions result in all gas being consumed, and the transaction being rolled back. Gas is not returned if a transaction is unsuccessful because otherwise malicious users could spam the network with unsuccessful transactions.

ii. Authorization security consideration – Never use tx.origin for authorization (Detail 1). If your wallet had checked msg.sender for authorization, it would get the address of the attack wallet, instead of the owner address. But by checking tx.origin, it gets the original address that kicked off the transaction, which is still the owner address. The attack wallet instantly drains all your funds (Detail 2).

wallet contract – Detail 1

pragma solidity ^0.4.11;

// THIS CONTRACT CONTAINS A BUG - DO NOT USE
contract TxUserWallet {
    address owner;

    function TxUserWallet() {
        owner = msg.sender;
    }

    function transferTo(address dest, uint amount) {
        require(tx.origin == owner);
        dest.transfer(amount);
    }
}

attack wallet – Detail 2

pragma solidity ^0.4.0;

contract TxAttackWallet {
    address owner;

    function TxAttackWallet() {
        owner = msg.sender;
    }

    function() {
        TxUserWallet(msg.sender).transferTo(owner, msg.sender.balance);
    }
}

Ethereum enhance the programming language of protection.But what’ the reason let’s the Biggest Ethereum and Bitcoin Exchanges Got Hacked?

About South Korea’s Largest Ethereum Exchange Was Hacked – Headline news hints that the attackers are setting their sights on people’s digital currency wallets (see following url for reference) http://fortune.com/2017/07/05/bitcoin-ethereum-bithumb-hack/. From technical point of view, this is client side data breach instead of server side, right.  Since the case is under South Korea law enforcement investigation. No details provides in the meantime. For more detail, please read following url http://english.yonhapnews.co.kr/national/2017/07/03/52/0302000000AEN20170703010400320F.html

My comment in regards to this case – since cyber incident more possibility happens on computer user negligence. Yes, I agree that we must focus the system and application design limitation. Since no any conclusion or prediction this moment. But a hints would like to bring to your consideration . Be my guest, see below detail for reference.

Fundamental design weakness of Ethereum node implemented in Go

Reference: When you are going to unlock account.   The command tool Geth will be used.  You’ll be prompted to type in the password afterward.

geth --unlock <YOUR_ACCOUNT_ADDRESS> --password <YOUR_PASSWORD>

A security concerns was happend here! In the earlier versions of Geth, providing the password as a parameter would cause the password to show up in the Geth log.  So our clever reader will speculated the story and final result properly. There is not required to mention the details again, right?

Remark – Geth is a multipurpose command line tool that runs a full Ethereum node implemented in Go. It offers three interfaces: the command line subcommands and options, a Json-rpc server and an interactive console.

Have a nice weekend.

Reference:

Rouge-et-noir , they are all going to achieve this objective (blockchain or Hyperledger)

Preface:

Before we jump into discussion see the bitcoin market status today

Ethereum briefly crashed from $319 to 10 cents , said Thursday (22nd June 2017) CNBC News.

http://www.cnbc.com/2017/06/22/ethereum-price-crash-10-cents-gdax-exchange-after-multimillion-dollar-trade.html

The CoinDesk Bitcoin Price Index provides the latest and most accurate bitcoin price using an average from the world’s leading exchanges.

As of today (22nd June 2017) ,1 Bitcoin equals 2716.06 US Dollar

How does Finance sector think about it?

How does criminal  think about it?

When we talk about blockchain technology, most of the time we will think about hacking. How to jail break the encryption algorithm. Few expertise opinion. The break point of the blockchain technology not focus on break though the encryption. Seems it is not easy to do. But bitcoin technology concerns of  “double spend” of electronic coins. In the sense that bitcoins technology itself is aware of it.  Are you interested of this information. Be my guest, take a short journey to dig out a little bit. Ok, are you ready. Our train is leaving the platform now.

World more complex, a new technology appears, it is  Hyperledger?

Hyperledger is an open source collaborative effort created to advance cross-industry blockchain technologies. It is a global collaboration, hosted by The Linux Foundation, including leaders in finance, banking, IoT, supply chain, manufacturing and technology.

Remark: Hyperledger compared to traditional interbank settlement , the overall completion need time will be shorten compared to traditional process. Meanwhile the hyperledger transaction of volume will be higher. Therefore the expert claimed that this is a speedy area like a motorway.

From technical point of view, Blockchain and Hyperledger technologies are located in services layer (see below).

No matter how the technology renovation in future, double spend might have possibility happens. Before we discuss the double spend attack technique concept.  Let’s use a simple way to understand the feature of both new and traditional technology elements. On this article, we found 2 units of element shown in Service layer. That is blockchain and hyperledger. Hyperledger benefits for cross-industry blockchain technologies. We can say it will be run in properaitery private network. Blockchain technology are open for public usage. You and me can enjoy the benefits (no transaction fees). May be you can dig out more. But above  criteria is easy for your identification. Below is the hyperledger blockchain platforms for your reference.

The availablility of Hyperledger blockchain platforms today.

Hyperledger Burrow – Burrow is a blockchain client including a built-to-specification Ethereum Virtual Machine. Contributed by Monax and sponsored by Monax and Intel.

Hyperledger Fabric – Contributed by IBM.

Hyperledger Iroha – Based on Hyperledger Fabric, with a focus on mobile applications. Contributed by Soramitsu.

Hyperledger Sawtooth – Contributed by Intel

We can go to cyber attack concept now, let’s move on.

Double-spend Attacks

Double-spending is the result of successfully spending some money more than once. It means that a suspicious transactions spend from the same inputs as the first set of transactions. The transactions conflict and are thus double spends. In order to avoid to this problem occurs. Only one transaction out of a set of double spends will be able to confirm. The rest of the transactions become invalid.

The one we consider of this attack does only work for fast payment scenarios. Oops….we known that hyperledger claim that he is work in fast payment scenarios? Are you kidding?

Actually a technical report issued by ETH Zurich did a proof of concept on the possibility of double-spend attack on blockchain instead of hyperledger. Below informative diagram can provide an idea to you in this regard. The test shown that make network traffic delay on Txv. And avoid the acknowledge  issued by Txa go to victim. The test found factual issue occurred in this circumstances.

Since developers and blockchain investors understand the weakness of current blockchain technology.  A group of financial investor build the next generation of technology goal to enhance the current technology design weakness. That is the hyperledger today.  The features enhancement area includes Message handling, Block Publishing/validation, Consensus, Global State Management. Below informative diagram display the overall operation infrastructure. A segregates transaction payload definition, validation and stat management logic to improve overall security.

Observation: In this secure environment, how does hacker do?

Regarding to the authorization check on hyperledger design (see below informative diagram) it provide a comprehensive monitor feature to prevent incorrect and suspicious transaction.  Hacker will take a another way round even through you have good authorization check system.

Since decryption of data not a easy way. It is time consuming and do not guarantee the successful rate. From technical point of view, hacker is not possible to spend on such afford. The possible and easy way is that hacker relies on the spear phishing technique. Then counterfeit messages appear to come from a trusted source fooling user in negligence. A misleading message lets user activate a internet link (url) which trigger malware infection. The hyperledger technique run in multi-layer architecture might expose more surface for attack. A insider threat might create a break point and causes the system compromised finally. As we know, ransomware is a hybrid architecture which coexists with malware and ransome features. Hacker can implant malware to a internal workstation then execute the ransomware attack afterwards.

The smart contract ID is unique reference number. No body else can help once the repository encrypt by hacker.

Is there any remediation solution on above matter?

Per my observation from past. Even though you have comprehensive detective and preventive security control. It is hard to avoid the incorrect business decision.  In short, what is the drawback on above matters in regards to business decision. The business shake holder intend provide more flexibility on the system function. For instance customization of the application to fulfill business objective.

For corrective control solution. We can do the following to recover the system after ransomware infection.

1. Increase the backup SNAPShot schedule. Since the delta improved. It reduce the overall loss of data percentage after system restore.
2. Not allow critical host have access internet function. Perhaps you say, it is inconvenient to do  the zero-day patch, critical patch and anti-virus signature update? But this is a important factor.

If you can use a simple way to move a mountain, why do you choose a heavy machine? Ok, let’s stop discussion here. Please take off the train.
But I will provide more interest topics soon! Bye!

Preface:

Take on public transportation today (11th May 2017), the headline news display on advertisement screen guide me start the discussion on block chain technology again.  It looks a realistic situation intend to boots up block chain technology growth. Let’s take a quick seen!

As of 6 February 2016, there are 15.2 million bitcoins circulation of a capped total of 21 million.

• Total volume: 1800 Billion of dollars
• 4 days exchange volume equal to 30 Billion of dollars

Block chain space Radical changes on 2017

In 2017 Microsoft announced their participation in the newly formed Enterprise Ethereum Alliance. Joining them are also companies such as Intel, J.P. Morgan, BNY Mellon, BP, ING, Thomson Reuters and blockchain startups. In general, my idea on key word “Ethereum” only focus on security incident. Sounds like that I am not suggest anyone to create Ethereum to let hackers get away your money.

Quote:  “In general, the Ethereum community is on board with the notion that we do not have to do things exactly the way that things are done in other crypto communities,”  -shortcut from Bloomberg Business week.

As a matter of fact, new technology has technical limitation not the 1st day we heard, but it has the mature model finally, right?  So I am not keen to my stubborn to say not suggest to use. Perhaps a positive discussion might provide more positive idea in this regard.

High Level understand of Ethereum

Ethereum is an open-source, public, blockchain-based distributed computing platform featuring smart contract (scripting) functionality.

Platform‎: ‎x86, ARM

Technical weakness on security viewpoint

Programming language: Go

How are blockchain application developed by “GO”. What is “Go”? “Go” is a free and open source created at Google in 2007 by Robert Griesemer, Rob Pike, and Ken Thompson . Like other programming language, this programming language contain their design limitation. The vulnerability found this year was shown that the “Go” SSH library (x/crypto/ssh) by default does not verify host keys, facilitating man-in-the-middle attacks. Default behavior changed in commit e4e2799 to require explicitly registering a hostkey verification mechanism.

Programming language: Rust

Rust is a general purpose programming language sponsored by Mozilla Research. It is designed to be a “safe, concurrent, practical language”, supporting functional and imperative-procedural paradigms. Rust is syntactically similar to C++, but is designed for better memory safety while maintaining performance. Rust only panics from integer overflow when in debug mode. So it looks that this programming languages suitable for developers build block chain system application.

Remark: Developer Analyst firm Redmonk charted Rust’s move on the Github rankings from 46 to 18.

Modern cyber technology crisis

Ransomware attack is the 1st priority of concern:

Ransomware (Wannacry) attack hits 99 countries with UK hospitals among targets yesterday. As we know the specifics attack are leveraging a Windows exploit harvested from the NSA called EternalBlue (MS17-010 –  the vulnerabilities could allow remote code execution if an attacker sends specially crafted messages to a Microsoft Server Message Block 1.0 (SMBv1) server). As a result it trigger the one to many attacks within the internal network.  Since it relies on SMB so it spread out in extremely fast way. We are not going to discuss this incident today.

The reflections of this incident let us know the design weakness can kill the system within 1 minutes and broadcast the attack to neighbor.  Be reminded that even though block chain or Ethereum technology network are built by group. It is a star topology network. A benefits for system and network resilience. However it increase the inherent risk.

Peer-to-peer communications between nodes running Ethereum clients run using the underlying ÐΞVp2p Wire Protocol. It is very secure. However if a trust client being compromised. From techincal point of view, hacker will more easy to infiltrate into it. Besides, the objective of ransomware  target  for ransom (money).  If the victim workstation (Ethereum client) or mobile phone (Ethereum client) was compromised by ransom (whole hard drive encrypted). A  high possibility to pay for the ransom otherwise he will lost more money.

Observation

As said, Ethereum deploy a high standard of secure protocol ( ÐΞVp2p Wire Protocol). However you can drill down in different area see whether can find out the design limitation.  For instance a well known vulnerability. A Java Debug Wire Protocol remote code execution. The problem was that JDWP ( Java Debug Wire Protocol) is one layer within the Java Platform Debugger Architecture (JPDA). JDWP does not use any authentication and could be abused by an attacker to execute arbitrary code on the affected server. Any impact here!

But my concern is on fast synchronization process. In the mean time I am still analysis what is the possibility to fool the remote peer on GetNodeData step. For more detail, please refer below specification.

Fast synchronization (PV63) specification:

GetNodeData [+0x0d, hash_0: B_32, hash_1: B_32, …] Require peer to return a NodeData message. Hint that useful values in it are those which correspond to given hashes.

NodeData [+0x0e, value_0: B, value_1: B, …] Provide a set of values which correspond to previously asked node data hashes from GetNodeData. Does not need to contain all; best effort is fine. If it contains none, then has no information for previous GetNodeData hashes.

GetReceipts [+0x0f, hash_0: B_32, hash_1: B_32, …] Require peer to return a Receipts message. Hint that useful values in it are those which correspond to blocks of the given hashes.

Receipts [+0x10, [receipt_0, receipt_1], …] Provide a set of receipts which correspond to previously asked in GetReceipts.

Summary:

Our discussion stop here today. I will provide more update in this regard. Thank you.

Reference:

Part 2:Blockchain technology situation – Malware join to bitcoin mining

Part 2:Blockchain technology situation – Malware join to bitcoin mining

Part 1:Blockchain technology situation – A Tales of Two Cities

http://www.antihackingonline.com/network-protocol-topology-standard/part-1blockchain-technology-situation-a-tales-of-two-cities/