A cryptocurrency is a decentralized digital currency that is designed for secure and private asset transfer and storage. As a currency, it should be difficult to counterfeit and double-spend. In this paper, we review and analyze the major security and privacy issues of Bitcoin. In particular, we focus on its underlying foundation, blockchain technology. First, we present a comprehensive background of Bitcoin and the preliminary on security. Second, the major security threats and countermeasures of Bitcoin are investigated. We analyze the risk of double-spending attacks, evaluate the probability of success in performing the attacks and derive the profitability for the attacker to perform such attacks. Third, we analyze the underlying Bitcoin peer-to-peer network security risks and Bitcoin storage security. We compare three types of Bitcoin wallets in terms of security, type of services and their trade-offs. Finally, we discuss the security and privacy features of alternative cryptocurrencies and present an overview of emerging technologies today. Our results can help Bitcoin users to determine a trade-off between the risk of double-spending attempts and the transaction time delay or confidence before accepting transactions. These results can also assist miners to develop suitable strategies to get involved in the mining process and maximize their profits.
In early 2000, Digital Gold Currency (DGC), a currency backed by gold, gained some popularity. DGC is considered to be a second-generation digital currency. It is issued by some companies that enable users to pay each other in units similar to those of gold bullion. Examples include iGolder, gbullion, and e-Gold. Although DGC seemed to have a bright future, it lost popularity due to its centralized structure. Politics may have also played a role in its declining popularity. Companies that provided DGC were forced to shut down by the federal government due to their inability to comply with the government regulations @cite_41 .
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The digital currency Bitcoin has had remarkable growth since it was first proposed in 2008. Its distributed nature allows currency transactions without a central authority by using cryptographic methods and a data structure called the blockchain. In this paper we use the no-cloning theorem of quantum mechanics to introduce Quantum Bitcoin, a Bitcoin-like currency that runs on a quantum computer. We show that our construction of quantum shards and two blockchains allows untrusted peers to mint quantum money without risking the integrity of the currency. The Quantum Bitcoin protocol has several advantages over classical Bitcoin, including immediate local verification of transactions. This is a major improvement since we no longer need the computationally intensive and time-consuming method Bitcoin uses to record all transactions in the blockchain. Instead, Quantum Bitcoin only records newly minted currency which drastically reduces the footprint and increases efficiency. We present formal security proofs for counterfeiting resistance and show that a quantum bitcoin can be re-used a large number of times before wearing out - just like ordinary coins and banknotes. Quantum Bitcoin is the first distributed quantum money system and we show that the lack of a paper trail implies full anonymity for the users. In addition, there are no transaction fees and the system can scale to any transaction volume. Many online games have their own ecosystems, where players can purchase in-game assets using game money. Players can obtain game money through active participation or “real money trading” through official channels: converting real money into game money. The unofficial market for real money trading gave rise to gold farming groups (GFGs), a phenomenon with serious impact in the cyber and real worlds. GFGs in massively multiplayer online role-playing games (MMORPGs) are some of the most interesting underground cyber economies because of the massive nature of the game. To detect GFGs, there have been various studies using behavioral traits. However, they can only detect gold farmers, not entire GFGs with internal hierarchies. Even worse, GFGs continuously develop techniques to hide, such as forming front organizations, concealing cyber-money, and changing trade patterns when online game service providers ban GFGs. In this paper, we analyze the characteristics of the ecosystem of a large-scale MMORPG, and devise a method for detecting GFGs. We build a graph that characterizes virtual economy transactions, and trace abnormal trades and activities. We derive features from the trading graph and physical networks used by GFGs to identify them in their entirety. Using their structure, we provide recommendations to defend effectively against GFGs while not affecting the existing virtual ecosystem. Bitcoin is the world's first decentralized digital currency. Its main technical innovation is the use of a blockchain and hash-based proof of work to synchronize transactions and prevent double-spending the currency. While the qualitative nature of this system is well understood, there is widespread confusion about its quantitative aspects and how they relate to attack vectors and their countermeasures. In this paper we take a look at the stochastic processes underlying typical attacks and their resulting probabilities of success. Bitcoin is a distributed digital currency which has attracted a substantial number of users. We perform an in-depth investigation to understand what made Bitcoin so successful, while decades of research on cryptographic e-cash has not lead to a large-scale deployment. We ask also how Bitcoin could become a good candidate for a long-lived stable currency. In doing so, we identify several issues and attacks of Bitcoin, and propose suitable techniques to address them.