Recently Discovered Bitcoin Vulnerability Is Even Worse Than Previously Thought

Siamak Masnavi

On Monday (17 September 2018), a vulnerability (known as CVE-2018-17144) in Bitcoin Core (Bitcoin's reference implementation), which had existed since version 0.14.0 of Bitcoin Core (released on 8 March 2017), was reported to developers working on Bitcoin Core as well as some projects supporting other cryptocurrencies that use this code (such as "Bitcoin ABC" and "Bitcoin Unlimited", the two leading full node implementations of the Bitcoin Cash protocol). This vulnerability was reported anonymously as a "Denial of Service" (DoS) bug. 

As covered by CryptoGlobe, Bitcoin Core developers came up with a fix for this bug the next day (18 September 2018), and released it as part of Bitcoin Core versions 0.16.3 and 0.17.0rc4. They urged anyone running vulnerable versions of Bitcoin Core (i.e. 0.14.0 up to and including 0.16.2) to upgrade to version 0.16.3 as soon as possible.

However, shortly after fixing the vulnerability, the Bitcoin Core developers discovered that the bug in the code causing the DoS problem was even more serious than previously thought because it also created a second problem: the same vulnerability could be exploited to inflate the Bitcoin supply (i.e. create new bitcoins, beyond the 21 million limit placed by Satoshi, which would have the effect of devaluing existing bitcoins). 

This meant that the code fix for the DoS bug would also take care of the supply inflation bug. But, probably in order not to cause panic, and to encourage quick upgrades, the developers decided to only disclose the DoS bug.

On September 20th, after a post in a public forum revealed the full impact of the vulnerability, the Bitcoin Core Developers decide to come clean and publish a full disclosure report for CVE-2018-17144.

Over half of the Bitcoin hashrate has upgraded to patched nodes (running version 0.16.3). The developers say that although they are "unaware of any attempts to exploit this vulnerability", it is still critical that "affected users upgrade and apply the latest patches to ensure no possibility of large reorganizations, mining of invalid blocks, or acceptance of invalid transactions occurs."

Featured Image Credit: Photo via "Crypto360" via Flickr.com; licensed via "CC BY 2.0"

Mike Novogratz Is Getting a Little Impatient With Bitcoin

Siamak Masnavi

On Thursday (April 2), Michael Novogratz, a former Goldman Sachs partner, as well as Founder, Chairman, and CEO of crypto-focused merchant bank Galaxy Digital, talked about his expectations for Bitcoin during the remainder of this year.

His comments about Bitcoin were delivered during an interview on CNBC's "Closing Bell".

Novogratz started by talking about the huge amount of interest in Bitcoin that he is currently seeing from institutional investors (such as hedge funds) and high net worth individuals:

"I am seeing investors I never saw before -- hedge fund investors, high net worth investors -- getting into Bitcoin for the first time."

He then mentioned that he had been recently saying on Twitter that he feels this is the year for Bitcoin to shine (due to all the money printing being done in 2020 by the world's central banks):

"I said this in a tweet: 'this is the year for Bitcoin', and if it doesn't go up a lot by the end of the year, I think I might just hang my spurs because it doesn't go up now, you know, I'm not sure when it will."

However, although Novogratz appears to be getting a bit impatient with Bitcoin, he still seems to believe in Bitcoin's fundamentals, he says that the huge amount of money printing being done at the moment, mostly in order to fight the economic harms of COVID-19, is going to devalue fiat currencies, and he expects Bitcoin to double in value within six months:

"We're seeing real flows in the Bitcoin.

"You know, it's a hard asset... Money doesn't grow on trades and right now feels like we crossed the Rubicon where everyone feels like money grows on trees.

"I think those tools are the wrong thing... we're gonna debase the value of fiat...

"We should have doubled within six months. We really should have. This is the time. And maybe within the end of the year, retesting the old highs of $20,000."

On March 26, Tyler Winklevoss, Co-Founder and CEO of digital asset exchange Gemini, called Bitcoin a "vaccine" for the "money printing disease":

Symptoms of the "money printing disease" that Winklevoss is referring to in his tweet are the recent actions of the Federal Reserve (aka "the Fed") in response to the huge economic threat to the U.S. (and world) economy posed by COVID-19.

As CNBC reported on March 26, the Fed Chairman Jerome Powell said in an interview with U.S. television network NBC's "TODAY" program that the U.S. central banks will continue to provide liquidity to businesses that need it:

"When it comes to this lending, we’re not going to run out of ammunition, that doesn’t happen. We still have policy room in other dimensions to support the economy."

Perhaps, the fact that Novogratz's latest comments about Bitcoin display a sense of impatience/frustration is because although Bitcoin managed to outperform both the Dow and the S&P 500 by a wide margin in Q1 2020, it still lost just over 10% of its value against USD in the last quarter.

Nevertheless, he has been increasingly cheerleading for Bitcoin in the past couple of weeks, as you can see by some of his tweets: