Outdated Bitcoin mining software loses miners thousands

Bitcoin has issued an urgent warning that very recent transactions could be invalid, due to a glitch with older mining software that could cause Bitcoins to be double-spent.

“Your bitcoins are safe if you received them in transactions confirmed before 2015-07-06 00:00 UTC.” Begins the warning on Bitcoin.org.

However, wallets running older software are “Currently vulnerable to double-spending of confirmed transactions…almost all software (besides Bitcoin Core 0.9.5 and later) will accept these invalid blocks under certain conditions.”

“All software that assumes blocks are valid (because invalid blocks cost miners money) is at risk of showing transactions as confirmed when they really aren’t. This particularly affects lightweight (SPV) wallets and software such as old versions of Bitcoin Core which have been downgraded to SPV-level security by the new BIP66 consensus rules. Note that the roughly 50% of the network that was SPV mining had explicitly indicated that they would enforce the BIP66 rules. By not doing so, several large miners have lost over $50,000 dollars worth of mining income so far,” the organisation continued.

The fix, reports Network World, is to get all miners off of Simplified Payment Verification (SPV) mining, as “lightweight (SPV) wallets are not safe for less than 30 confirmations until all the major pools switch to full validation.”

In a followup story, Network World reports that the glitch is speedily being resolved as Bitcoin miners and consumers update their software: “Bitcoin experienced a glitch over the weekend that is expected to be resolved as software clients that handle transaction data are upgraded.”

Although Bitcoin is by far the most famous and most widely used of the cryptocurrencies, as welivesecurity.com reported recently, there are significant alternatives emerging. Check out our five alternatives to Bitcoin here.

Author , ESET

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