The Mystery of the Largest Bitcoin Block in History

The largest bitcoin block ever was published on Tuesday on the blockchain, the publicly visible ledger that records all changes to the cryptocurrency. At 999 kilobytes in size and filled with transaction data, it prompted a user in a bitcoin developer chatroom to call it "RIP Bitcoin."

We know who minted this block: F2Pool. This is one of the main mining pools in China, where a group of miners combine their mining resources to mine together, with the goal of confirming blocks faster. We also know why someone did this. It's because someone, or perhaps a group of people, sent a large number of tiny Bitcoin transactions on the network, which people call "dust transactions", which is a kind of attack method to block the transaction pipeline and even destroy the Bitcoin system. At least, it has such an effect for the time being.

What we don’t know is who initiated these junk transactions or why they did it. The attack is still ongoing, and there are currently tens of thousands of transactions waiting to be packaged into the blockchain, and miners are also working hard to cope with the attack of junk transactions.

Could someone be trying to reduce or even sabotage the power of Chinese mining pools? Could the Bitcoin community simply want to test the system? Could it be a fierce Bitcoin developer trying to prove something? Here are the best conspiracy theories about who is behind this.

Fierce developers

Over the past few months, the Bitcoin community has been embroiled in a debate over whether to implement a code change that would allow Bitcoin to accommodate the increased volume of transactions that would come with worldwide adoption by increasing the block size. The downside is that this would inevitably lead to a blockchain fork, as it would require everyone to migrate to a new version of the ledger.

The proponents of this debate - led by developer Gavin Anderson - argue that linear systems are clearly unable to cope with the large volumes of flows and transactions, as evidenced by the dust trading happening now.

But not everyone sees it that way. Some developers and powerful Chinese mining pools - the total computing power of Chinese mining pools exceeds half of the total network computing power - have expressed dissatisfaction with Gavin Anderson's plan, as it may bring inevitable chaos to the current Bitcoin system.

To test Andresen’s claims, bitcoin company Coinwallet.eu has conducted two separate “stress tests” — essentially what’s happening now, but on a smaller scale — to see if the system can handle the activity. In both tests, the bitcoin system performed poorly.

At the start of this more serious spam attack, some Reddit users suggested that the perpetrator might be a Bitcoin developer who supports Andreessen and that the attack was intended to prove their point: we need bigger blocks.

Many spam transactions are sent to known addresses and phrases that are easily decomposable, which makes it easy to clean up these transactions. This may just indicate that the person behind this attack does not want to destroy Bitcoin, but to warn it. Whoever is behind this attack does not want to see Bitcoin destroyed, but just wants to remind people of the weaknesses of the existing Bitcoin system.

Someone is trying to crack down on Chinese mining pools

Powerful Chinese mining pools have taken a stand against the proposed changes to Bitcoin. Their main argument is that they have limited bandwidth compared to their counterparts in the United States and would not be able to keep up if larger blocks were implemented.

Peter Todd, a Bitcoin Core developer, said:

“A lot of people are very angry at Chinese mining pools, especially F2Pool. There are many reasons for this, like Chinese miners jumping out to oppose Gavin Anderson’s proposal to increase the block size. Cracking down on Chinese mining pools can reduce the importance of Chinese miners’ opinions so that Chinese miners’ opinions don’t matter as much.”

Mike Hearn, another prominent Bitcoin developer, has pointed out that if Chinese miners refuse to change and continue to extend the old blockchain, then a code upgrade could kick Chinese miners out of the network entirely. Todd's view is that by attacking F2Pool with junk transactions, the public's image can be damaged, and such a method of weakening Chinese mining pools is more acceptable to the public.

Todd said:

“Whereas with F2Pool, if the attacker knew they were going to clean up dust like they are doing now, the attacker could have said, why am I doing this for nothing? So when you clean up a lot of dust, people are going to complain about F2Pool because the blockage is rare and newsworthy.”

However, this conspiracy theory of attacking Chinese mining pools is unlikely. Because from the attacker's point of view, it is necessary to foresee that it is F2Pool, not other Chinese mining pools, or even North American or European mining pools, that chooses to clean up dust transactions. If the intention of the action is to attack F2Pool, the final effect will not be apparent, because people soon discovered that the miners were only cleaning up dust and did not attack the Bitcoin network.

Community Maintenance

This explanation seems the most likely. Since it seems that the attack was designed to be easy to solve, and since it was not staged by a Chinese mining pool, this spam attack can only be explained as another "stress test".

Nicholas Weaver, a computer security researcher at the University of California, Berkeley, told me in an email:

“To reinforce the need for a block size increase, there has recently been a ‘Bitcoin stress test’ campaign that attempts to convince people that Bitcoin should increase its block size to handle more transactions per second by clogging the network with junk transactions.”

In Vivo's view, the Bitcoin address used in this stress test is exactly the same address used in the previous stress test initiated by Coinwallet.eu. This is a key piece of evidence. Although Coinwallet.eu previously publicly announced that it would conduct a stress test, it did not do so this time.

In the first test, Coinwallet used 20 bitcoins, worth about $5,000, to spam transactions. However, Vivo said this attack was much cheaper than the first one.

Vivo says:

“In this attack, the attacker used 3 bitcoins, about $800, but the cost of this attack may be much less, and when the attack is completed, the transaction fees may be returned to the attacker’s wallet.”

If Coinwallet.eu was behind the attack, it’s either because they got smart and realized they didn’t need to spend $5,000 to take down Bitcoin, or because the people behind it were on a tighter budget. We don’t know the truth, but it could be worse. Since the vast majority of activity on the Bitcoin network is anonymous and encrypted, it’s difficult, if not impossible, to verify attribution when a flood of spam hits the Bitcoin network. While Vivo and Todd offered their own guesses about who was behind the attack, another person I contacted, Hearn, said when I asked him if he had any idea who was behind the attack, he said that was impossible—the fact is that there’s little we can do to confirm any of our guesses. Even F2Pool can’t be completely cleared of suspicion, although both Vivo and Todd said that F2Pool’s involvement in the attack was highly unlikely.

However, it is important to note that the attack could be further exacerbated. According to Vivo, the attacker could easily and slightly increase the transaction fees of their junk transactions so that they would be prioritized by miners, and then the real transactions would be stuck waiting for confirmation, which would reduce the efficiency of the network.

In the end, it looks like Bitcoin will survive this attack. Perhaps, after the attack is over, the person behind it will reveal his or her identity and everything will become clear. Who knows, maybe this person is Satoshi Nakamoto himself.