Exploring Partitioning Attacks on the Bitcoin Network

Abstract

Bitcoin is the leading example of a blockchain application that facilitates peer-to-peer transactions without the need for a trusted third party. This paper considers possible attacks related to the decentralized network architecture of Bitcoin. We perform a data driven study of Bitcoin and present possible attacks based on spatial and temporal characteristics of its network. Towards that, we revisit the prior work, dedicated to the study of centralization of Bitcoin nodes over the Internet, through a fine-grained analysis of network distribution, and highlight the increasing centralization of the Bitcoin network over time. As a result, we show that Bitcoin is vulnerable to spatial, temporal, spatio-temporal, and logical partitioning attacks with an increased attack feasibility due to the network dynamics. We verify our observations through data-driven analyses and simulations, and discuss the implications of each attack on the Bitcoin network. We conclude with suggested countermeasures.