Reminiscences of a Clock Operator
Ab(stract) Initio
Tempus fugit, armor manet. So the saying almost goes. Time is all
around us, watching our lives and clocking our hours as we grind to dust
under insatiable formations of capital. Ever-increasing precision of
timekeeping has led to the atrophy of the human attention span, as
productivity flatlines. Who built all the clocks? This article sets out
to draw parallels between historical insights regarding the ontological
status of time and emergent phenomena observed recently in decentralised
systems, namely Bitcoin and Ethereum. Cryptocurrencies are timestamping
systems at their core. A discretised, linear data architecture sometimes
known as 'the timechain' provides a reasonable degree of assurance that
the network will respect a particular set of transaction orderings
which, when chained together manifest a canonical historicity. Are these
new legends also being written by the winners? Does capital formation
necessitate a temporal polity? The transcendental mechanism known as
proof-of-work leaderlessly transmutes immanent, continuous network
activities into ordinally sequenced batches of confirmed transactions.
As a byproduct of this process, temporal paradoxes are encoded in the
beating heart of cryptocurrency network logics. This combination of
polity and paradox leads to unintended consequences as chronobandits run
wild in the dark forests of the timechain.
Pt 1. A New World Ordering?
Horological Fallacies
"I am separated from myself by the form of time"
Gilles Deleuze, Kant's Critical Philosophy, p. ix
Time, as the most common noun in the English language, is familiar to all of us. At one level of phenomenological experience at the very least it provides a cumulative
and sequential framework of continuity and progression that human
conscious experience is ostensibly anchored in. A distinction is drawn
by some between the objective, precise and measurable rhythm of devices
marking the passage of time (c.f. Plato or Plotinus' 'moving image of
eternity', Chronos) and the subject's experience of temporality (c.f.
Bergsonian 'duration',
Kairos). Spiral, cyclical and abstract folk ontologies of time offer
alternatives to the western and colonial hegemony of linearised
traversals between past and future.
A line (or perhaps an arrow?) may readily be drawn between the symbolic
reductions of Newtonian physics and Kant's transcendental idealism.
Issac Newton championed the notion of 't' as a universal, absolute
time to render tractable many hitherto unaddressed natural mysteries. He
rationalised this by proposing that humans could only perceive relative
time indirectly through the movement of for example celestial objects.
In so doing, he initiated a paradigm of time-dependent science which
many of his contemporaries, not least Gottfried Leibni(t)z vigorously
opposed. A century or so later, Kant proposed a radical re-architecting
of the ontological hierarchy of the universal dimensions, anointing time
as 'a priori' and'pure
internal intuition' that is no longer subject to movement and correlated to but not
subordinated by space. Kant's transcendental criterion necessitates the
existence of a boundary to the "outside", with an immanent plane of
experience "inside".
"Time is impassive, more animal than human. Time would not care if
you fell out of it. It would continue on without you. It cannot see
you; it has always been blind to the human and the things we do to
stave it off, the taxonomies, the cleaning, the arranging, the
ordering."
Lauren Groff on David Rooney's About Time,
NYRB
Temporality is often found imbricated with influence, hierarchy and
control. The clock signifies precision, consistency and reliably
verified measurement, but is simultaneously a tool of control and
discipline. By whom does the bell toll? Temporal polities. Organised
religion still uses solar and lunar calendars to regiment behaviours and
decide when certain rituals take place. When sundials and water clocks
were first installed in Carthaginian, Roman and Greek settlements, local
bureaucracies harnessed their new timekeepers to regiment workers'
routines. As curfews began to be set by the clock rather than Sun, our
newfound temporal regulators became enforcers of social order. Factory
owners built crooked clocks to extract further productivity from their
exploited labour forces.
Embedded within the device is a question of power: decisions were made
to fund, design, construct, deploy, calibrate and enforce the logics of
a timekeeper. In enshrining the chronological restraint of temperance as
a virtue, does dyschronia imply iniquity? Who gets to decide what time
it is? Can there be fairness when the relationship between past, present
and future is in the hands of a chrony cabal? Who regulates whom? Do
the bounded logics of communication necessitate the existence of insider
asymmetries, through time as well as space? If we live by the clock,
must we also die by the clock? It is this article's premise that new
forms of durational abstractions - be they **machinic,
algorithmic, cyberspatial and/or
cryptographic - are being used by entrenched powers and
capital for essentially the same ends as the old timers.** The
affordances, limitations and externalities of timechain systems extend
into time and space in new and unexpected ways. But the same temporal
polities appear to emerge as with many asymmetric scenarios. Regardless
of its ontological status, time as a socio-cultural construct functions
sufficiently effectively to act as control infrastructure.
"How can one capitalize the time of individuals...in a way that is
susceptible to use and control? How can one organize profitable
durations? The disciplines must be understood...as machinery for
adding up and capitalizing time."
Michel Foucault, Discipline and Punish, p. 157
As increasingly sophisticated clocks marked the passing of days, months,
years and decades, Newtonian and Kantian theoretical approaches to
understanding time's place in the Universe remained largely untested
until the advent of relativistic and quantum physics. First, general
relativity did away with the notion of temporal homogeneity. There is no
universal and absolute time 't'. Time is lumpy and uneven, locally
consistent and providing partial ordering of events but far from the
untouchable 'inner form' that Newton and Kant imagined. With quantum
mechanics, phenomena such as wave-particle duality, non-localisability,
discretisation, entanglement and uncertainty made it apparent that time
was subject to and governed by similar factors as energy and space. An
observer - or rather, a measurer - could affect the state of a system
and cause a superposition to collapse into a particular configuration.
This brought into sharp focus the subjectivity inherent in our
spatiotemporal conception of reality, despite the impressive formalisms
of classical physics and German idealism.
"Time has taken on its own excessiveness.
It is out of its joints."
Immanuel Kant, Human Dignity, p. 12
{#ntmdr44l020}
Measurement as the trigger for collapsing of superpositions, as evinced
by the double-slit
experiment, first
conducted with light by Thomas Young in 1801.
Time is often regarded with a thermodynamic lens, to the extent that
entropy is considered synonymous with time's arrow. This is largely due
to the readily observed gradual increase in disorder within closed
systems, such that entropy appears aligned with the passage of time. In
some sense classical thermodynamics uses entropy as a thermal clock,
though there is still a lack of commensurability with the quantum
mechanical conception of entropy (see Orly Shenker & colleagues
here and
here). Ongoing work on
quantum theories of gravity suggests that time is largely an illusory
relational
construct
and/or artifact of conscious experience.
Tempus Interregnum
Bitcoin is at its heart a distributed system whose goal is to achieve a
leaderless consensus as to the ordinality of a series of occurrences.
Bitcoin is a decentralised timestamping server, and the transactions are
simply messages changing the effective balances that each network
participant has access to. These balances are denominated in the native
unit of the system (BTC), and are used to pay transaction fees to miners
and function as the de facto currency with which value is
redistributed amongst the users of the network. Satoshi Nakamoto
themselves used the word 'timestamp' fourteen times in the Bitcoin
whitepaper. Bitcoin is an
abstract timekeeping daemon incarnated through cryptography and
thermodynamics.
"In this paper, we propose a solution to the double-spending problem
using a peer-to-peer distributed timestamp server to generate
computational proof of the chronological order of transactions."
Satoshi Nakamoto, Bitcoin whitepaper
Abstract v1, 2008
{#n8joqt0vnuo}
Bitcoin whitepaper §3: Timestamp
Server
Originally referred to in the source
code
of early Bitcoin software client versions as 'the timechain', it is
more commonly referred to today with the rather less appealing and
uninformative moniker of 'the blockchain'. Let us attempt to address
this: the timechain is a chain of blocks, which are themselves batches
of transactions, pages in an abstract accounting ledger. The timechain
functions as an information repository that allows anyone to confirm the
order and details of transactions without needing to be permanently
online, with a new batch of network actions enshrined in a block and
being added to the timechain, thereby updating the shared record of
balances approximately every 600 seconds.
{#njkdpivbm0a}
2013 Bitcointalk forum
post
with excerpts from the original Bitcoin client source code, referring
repeatedly to 'the timechain'.
Scholars of idealism find in Bitcoin a metaphysical temporal fabric with
its own heartbeat. A new timekeeping system - indeed, a new kind of
time - made manifest by the timechain. Welcome to the chronaissance.
This literal quantum leap in abstract time is divorced from celestial
influence and mostly unphased by the increasingly subdivided temporal
constructions of modern Homo
Clockonomicus
in pursuit of efficiency and productivity. A new ordinal domain
where time reigns supreme. But this is not the end of the story: there
is no happily ever after on the timechain. A new breed of
necroprimitivist chrononauts exerting control whilst deriving
religious zeal and economic gravitas from these energetically costly
upstart instruments of temporal synthesis and mutation are in the
ascendance.
{#n4jklwrpsdu}
Illustration of Temperance from Heinrich Suso's 'Horologium
Sapientiae', ca.
1450.
Notes on the Poverty of Block-time
Dysclocksia
Timechain technology does not afford a unified, singular chronognostic
regime but rather a schizotemporal duality. A continuous cyber-clock
mode exists where nodes propose transactions in 'real-time' and a
discrete block-clock mode ticks to the sequential cadence of confirmed
blocks. Proof-of-work is the transcendental mechanism which leaderlessly
transmutes immanent, continuous-time network activity into
ordinally-sequenced batches. A burnt offering for an indifferent god. In
the collapsing of one into the other the opportunity for arbitrages,
slippages and other chronically adversarial behaviours emerge.
Transactions are confirmed by miners selecting the user-broadcast
proposals they wish to include in an upcoming block, typically
prioritised by the size of transaction fees paid. The miner finding the
next block in effect decides which messages are canonised in the
timechain, whilst having a comprehensive view of network-wide proposed
transactions. There are a number of strategies that a greedy miner can
utilise to extract value beyond the protocol-expected payoff of
network-issued mining rewards and user-supplied transaction fees. These
approaches mostly require engagement in behaviour not initially
anticipated by Nakamoto's protocol design. These include transaction
reordering, virtual resource arbitrage, hostile forks and 51% attacks.
These occurrences are rising in frequency, which suggests that the
implicit social contract between network stakeholders might be breaking
down over time.
Aspects of cyber-clock time (hereafter cyber-time) and block-clocktime
(hereafter block-time) were characterised by Anna Greenspan in her
doctoral thesis 'Capitalism's Transcendental Time
Machine' (2000) in reference
to a more general conception of cyberspace-time. Greenspan's thesis
predated Bitcoin by approximately a decade, and one might speculate as
to a different exemplar of an Aeonic occurrence - in Bitcoin rather than
Y2K - were it written a decade later. Greenspan considered
cyberspace-time to be inhumanistic, mechanically simulatory and implying
quantisation. As cyberspace is nonlocalisable, its regime of time would
be transglobal or postglobal - today we might use the term
decentralised. An immanent machinic culture (p2p), cyberspace-time
would measure nothing outside of its domain of orientation
(hard-bounded). As an abstract-yet-empirical method of timekeeping,
cyberspace-time would require a larger paradigm shift than the clock was
to the calendar. Taking this further, Nick Land characterised Bitcoin as
'chronogenic process' (Crypto-Current §0.83,
2018) and the
timechain as a 'transcendental reality criterion' (Crypto-Current
§1.15, 2018). One
might even venture as far as to say that Bitcoin is a deus ex nihilo.
Benjamin Noys proposes that Bitcoin exhibits 'stable
dematerialisations' (AHR,
2020),
though one might counter that the perceived stability is somewhat
illusory due to the eternal contingency of timechain probabilistics (see
Zeno-sum Games) and that a metastable dematerialism would be more
fitting.
Chronaissance
The cyclically rhythmic and discretised temporality of cryptocurrency
networks - the block-clock mentioned earlier - is hardly something to
set one's watch by. As
proof-of-work is a
random process involving searching a possibility space iteratively using
brute-force computational repetition, the time between candidate blocks
that fulfil the network-mandated validity conditions - valid
transactions and block construction, hash value below the difficulty
threshold - is variable. This is a stocha(o)stic process, and as a
result the time between blocks is unpredictable and can differ widely.
The network periodically recalibrates difficulty: the probability of a
given hash satisfying the conditions for block creation, which in turn
serves to adjust the inter-block cadence. In Bitcoin, a median
inter-block cadence of 600 seconds is targeted, but it is entirely
feasible to take twice as long to find a block, with the next block
following just a handful of seconds later. Naturally, this durational
volatility smoothens over a larger sample size but for predicting the
real-world timing of a timechain event (such as the subsidy
halving
in Bitcoin, discussed later) can be challenging. A mitigation which is
taken in Bitcoin to deter attacks employing deliberately false
timestamps also has a side effect of helping make longer-term unions of
block and clock times such that temporal averaging measures are
routinely used in slow-block networks such as Bitcoin.
Median-Time-Past
(MTP) takes the
median of timestamps of the previous 11 blocks as a trailing time
average, to avoid any issues with inaccurate timestamps, be they
accidental or malicious. As Bitcoin does not have an endogenous
mechanism to access clock-time, the network relies on miners including
temporal attestations inside their proposed blocks. Due to the widely
distributed and leaderless nature of cryptocurrency mining, propagating
information across the node population may not be trivial due to long
distances and variable communication infrastructure. Thus it is entirely
feasible that a late block (with a higher block number) may have an
earlier timestamp than the preceding block and protocols typically allow
some chronological leeway for these reasons before considering blocks
invalid. This temporal affordance is two hours in Bitcoin, which
corresponds to twelve times the target inter-block cadence. However, the
timestamp of the latest block must
always
be
greater
than
MTP.
Thus, MTP is the monotonically incrementing temporal machinery at the
heart of Bitcoin's chronaissance. The timestamps used in Bitcoin employ
the Linux format, being 32-bit unsigned integers starting on 1st January
1970. They are not vulnerable to the Epochalypse bug in
2038, when
32-bit signed integers using the original Linux timestamping system will
experience temporal overflow. The Bitcoin network will instead 'run out
of time' ceteris paribus in 2106.
Zeno-Sum Games
Some years ago in rather unrelated work, I was working towards a series
of meta-epistemic frameworks for an approach to classification of
cryptoassets and networks called
TokenSpace. As a passing comment
regarding the lack of price
elasticity
in the supply of Bitcoin, a formulation of the intrinsic value of
Bitcoin measured solely with reference to time (either block-time or
clock-time) that was later identified as an example of a Carnapian
Ramsay
Sentence. It is
included below with a slight modification, as the Bitcoin network has
undergone an additional subsidy halving since the time of publishing,
thereby altering the terms of the thermoeconomic bargain that miners
must adhere to in order to continue playing the Bitcoin game.
"Considering the functionality of the Bitcoin network, the current
value of one bitcoin may be understood implicitly as the value of 96
seconds of the computational resource directed at defending the
network from thermodynamic attacks and providing a high probability of
assurance that the integrity of the canonical ledger will continue to
be maintained."Wassim Alsindi,
TokenSpace,
2019 (edited)
The significance of this definition is that it renders explicit the
chronoeconomic jeopardy inherent to Bitcoin's continued security. In
order for the defence budget to be met as the subsidy attenuates
stepwise by 50% every 210000 blocks, the external market-determined
price of Bitcoin must continue to increase. As many acolytes have been
saying for years, Bitcoin is 'zero or moon'. It must continue to
escalate in price or it will fail. The difference in the amount of
security-time that a single Bitcoin has to purchase before and after
each subsidy halving is a simple doubling: in clock-time the most recent
halving took this security-time-per-Bitcoin from 48 seconds to 96
seconds (assuming target mean inter-block cadence of 600 seconds),
whilst in terms of block-time this number has incremented from 8% to 16%
of the inter-block cadence. In essence, the subsidy halving embeds at
the heart of Bitcoin (and by extension all Bitcoin-like systems) a
Zenoeconomic paradox which creates the conditions for a zero-sum game
pitting capital and ecology against each other. Another quirk of
Bitcoin's latent Zenoeconomics is that 50% of all the Bitcoins that will
ever be mined were distributed in the first few years of Bitcoin's life,
with a very small set of beneficiaries. All of this effort expended, so
that only a few may print time, mint money and decide history.
{#nnzd3g5z5yz}
The relationship between BTC block height, mining subsidy and supply
issuance. Wassim Alsindi,
Forkonomy,
2018.
Pt 2. Case Studies: Xenotemporalities in the Wild {#pt-2-case-studies-xenotemporalities-in-the-wild}
"Even inside the networks, it's markets all the way down. Including a
transaction in the next block is in reality a market process too. One
must out-bid others to motivate a miner to include your transaction in
a block, and even then the corollary market for transaction ordering
might scupper you with miners extracting 'your' value. What we see in
today's conception of timechain is the apotheosis of neoliberal
deterritorialization. Literally everything: the church, the state, the
corporation is subsumed into the network. Everything is marketised."Wassim Alsindi, edit of interview quotation in Awham Magazine, Issue
4, 2021.
Gnon In 15 Seconds: A G(u)ild for Hyperspace Travel
Front-running and Miner-Extractable Value (MEV) are emergent dystemporal
phenomena that many people new to the world of timechains might not be
unaware of. A well-established tactic in traditional financial markets,
front-running is essentially queue-jumping. In High Frequency Trading
(HFT), trading firms would buy up tiny slivers of real estate as close
to the Chicago Mercantile Exchange as possible. Proximity reduces
response time to key pieces of information, thereby allowing traders to
react ahead of competitors.
In the timechain setting, front-running exists due to a mismatch between
the temporalities of network and ledger as discussed earlier
(Dysclocksia). By acting as temporal mediators, miners get to 'see
into the possible futures' of the network regardless of whether they win
the lottery to find the next block. Miners can 'extract value' beyond
the implicit social contract of mining rewards and user-supplied
transaction fees at the expense of innocent users by inserting their own
versions of previously proposed unconfirmed transactions. In many ways,
timechain front-running resembles the 'Payment For Order Flow' that HFT
firms such as Citadel Securities pay handsomely for to have 'foresight'
and 'priority' over retail investors at mass trading outlets such as
RobinHood.
MEV has been on the rise on the Ethereum network in recent times. In
addition to the obvious issues it poses for the viability of timechain
economics and infrastructure, additional consequences exist. By
generating network congestion and pushing transaction fees higher, MEV
appears to be an accelerant of 'timechain gentrification'. Taking a leap
further than transaction-level MEV, a recent
version
of an Ethereum software client promised miners rewards for on-demand
chain
reorganisations.
Block-level MEV is
another emerging threat to the perceived structural affordances of
timechain networks.
Various mitigation strategies to MEV have been proposed and some
implemented in the wild, which provide centralised and/or decentralised
solutions by circumventing the need for users to publicly broadcast
their transactions to the network before being included in a block. This
has been used in the wild in cases such as art collectors or speculators
wishing to mint or accumulate multiple NFTs at the floor price of a
collection without wanting other parties to be aware of their actions in
advance. Without dealing directly with miners, there would be no
guarantee that their transactions would go through 'atomically' in a
single block, thereby raising the prospect that MEV 'solver' bots would
detect their behaviour and intervene to accumulate floor price tokens.
There are a number of pro-MEV arguments, chiefly that arbitrage makes
markets more efficient or that protocol builders should build
mitigations into their DeFi systems, such as orders which can only be
filled by nominated addresses. It is also notable (praise be to
Kairos) that MEV has risen to prominence recently in concert with
reward-attenuating changes to Ethereum's proof-of-work initiated by the
EIP-1559
upgrade. Are
miners taking back control after developers changed the network
constitution to reduce their share of the network's bounty? The keepers
of time and money will always have outsize sway.
Chronomancy: Storage, Compute and Time
As alluded to in the previous section, the wildly volatile expense of
using public timechain networks is well known and documented. In
Bitcoin, the variation of transaction cost scales up or down orders of
magnitude depending on demand to be included in the next block. With
Ethereum-like networks which afford more generalised computational
capabilities, the cost to transact - and space available in each block -
are measured in terms of computation. The market for smart contract fuel
- known colloquially as 'gas' - follows analogous logics to the market
for any other scarce resource. Buy low, sell high: as an efficient
commodity arbitrageur is wont to do.
As Ethereum-type networks allows for facile tokenisation, and gas can be
stored within smart contracts (and therefore tokens), Project
Chicago created multiple variants of
a GasToken Solidity contract which allows
for the minting of tokens which store gas, and do little else. One can
envisage a series of 'gas-bots' which monitor the demand for
computation on Ethereum-based networks (as referenced to their long-term
averages) and mints GasTokens when network demand is low, then burns
them to reclaim, use or sell the computation proxy when prices are high.
This might happen when major network events take place - forks, subsidy
changes, token launches and so on. A relatively benign use of GasTokens
would be as a hedge against volatility in computation prices - just as
power suppliers or transportation companies engage in resource futures
markets. Miners have had the option of filling their blocks with
gas-storing self-transactions, and now a wider spectrum of network
stakeholders in principle also have this capability.
Due to proposed
changes
in the Ethereum network the risk of serious impact by GasToken is not
very high, though this may not be the case on other networks. There have
been reports
that GasToken has had a significant impact on Ethereum Classic and was
being held responsible for state bloat. The Ethereum Classic timechain
had been growing in size faster than would otherwise, pushing
externalities onto node operators in the form of increased storage
requirements. Further, some centralised trading venues experienced
griefing-type attacks
where the failure to limit computation caused some unforeseen value
leakages.
The GasToken imposes burden upon collectively managed distributed
network storage, and as well as potentially pushing computation costs
higher (due to the creation of a new secondary market), and storage
costs might also rise. GasToken also wastes block space due to
inefficiencies in the mechanisms it uses (gas refunds are only partial
in most cases), and could be rendered ineffective by networks removing
the gas refund for clearing contracts or storage. Indeed GasToken can be
thought of as a cross-commodity mispricing of resources by connecting
the market for storage with the market for computation, with time as the
arbitrage medium. Only those who know the secret may pass to the
hallowed land of riskless arbitrage, others must pay in time or space.
The Durational Alchemy of Time-Warp Attacks: Making Real Money From Fake Time
Due to the inability of Bitcoin to trustlessly synchronise with external
timekeeping systems, Bitcoin cannot verify the accuracy of
miner-submitted timestamps and averages timestamps of recent blocks to
avoid issues with inaccuracies. There is a long-known theoretical
vulnerability in Bitcoin - and Bitcoin-like systems also employing
proof-of-work - which uses false timestamps maliciously to game the
network. This has come to be known as a 'time-warp attack', however has
never been knowingly observed on Bitcoin itself. Examples of the attack
have however been observed on both Bitcoin testnets and other
proof-of-work cryptocurrencies.
The attack starts with a miner submitting blocks with timestamps which
are inaccurate but still within network tolerance (up to 120 minutes ≈
12 Bitcoin blocks). This has the potential to affect the mining
difficulty adjustment as it retargets the likelihood of a valid
proof-of-work hash to satisfy the network's conditions as an acceptable
block. Proof-of-work is essentially a Sybil-resistance mechanism, it
prevents malicious actors from flooding the network with spam or noise
by making block creation costly through the hashrate-mediated difficulty
adjustment. But when false (early) timestamps are submitted and accepted
as valid, the network's difficulty might adjust downward thus making
mining easier. Therefore the attacker can build a longer & stronger
chain with more accumulated work than the current one in private, only
broadcasting found blocks when they are able to claim canonicity of
their alternative history. The reduced network difficulty would
potentially allow the attacker to create blocks faster than they can
propagate across the network, thereby orphaning many other candidate
blocks and essentially monopolising mining. As the work would be lower
on the time-warp chain, this would have to be a much longer chain to
claim canonicity but the block subsidy would potentially offset the work
required. On Bitcoin, a time-warp attack would also necessarily require
51% of the hashrate which presents its own issues for the security of
the network (see above).
That this attack has not been observed in the wild on the Bitcoin
network suggests that would-be exploiters - despite economic and/or
ideological motivations - consider this attack impractical or
unprofitable compared to rational modes of mining. Due to the long
inter-block cadence on Bitcoin (600 seconds) and the wide window for
difficulty adjustment retargeting (2016 blocks ≈ 14 days) the start of
an attempt to conduct such a strategy would be immediately apparent to
those monitoring Bitcoin mining, either from studying inaccuracies in
the timestamps themselves, or by noticing the divergence of
median-time-past with respect to clock time. Miners who do not wish to
collude with such an attack can also take action, by refusing to build
upon blocks with inaccurate timestamps. It is conceivable that users and
economic stakeholders in the Bitcoin network would apply pressure to
large mining constituencies (farm and pool operators) to boycott
suspected time-warp blocks.
These behaviours have been documented on other networks. Firstly,
Bitcoin testnet3 - which is a clone of the Bitcoin protocol network but
with valueless tokens intended for R&D - uses the same proof-of-work
algorithm as Bitcoin but due to lack of token value has a very low
network hashrate. As a result, an entity desiring a large quantity of
testnet-Bitcoins could direct hashrate to the network. This would
ordinarily increase the difficulty, but by using inaccurate timestamps
the difficulty can be kept low. There have been cases where a time-warp
attack has incapacitated testnet3, until a rival miner directs
sufficient computational resource to increase the network difficulty.
Testnet3 also has some quirks related to mining difficulty which make it
easier to game. More than one circumstance - such as a long period
without blocks - allows miners to create a block with the lowest
difficulty possible.
More salaciously, the small proof-of-work network Verge (formerly
DogecoinDark) was subject to multiple time-warp attacks in early 2018.
The exploit approach mirrored that theorised above, but with an
important addition that enabled them to conduct the exploit (and claim
several million USD worth of XVG tokens at time of attack) as a result
of an additional complexity present in Verge as opposed to Bitcoin. As
an attempted mechanism to engineer ASIC-resistance - now considered a
largely futile way to ensure that no specialised mining equipment can be
created for a proof-of-work network - Verge employed a
naively-constructed sequential cycling of five different hashing
algorithms, each with their own difficulty parameter. As some of the
five algorithms already had specialised mining hardware (which may have
been privately available if not purchasable by the wider public), the
time-warp attacker merely focused their efforts on Scrypt mining,
changing the '51% condition' to between 0.5 and 10% of the network
hashrate. Further, Verge's network difficulty retargeted every 30
minutes (rather than the 2016 block ≈ 14 day window in Bitcoin) making
the attack very rapid to get going and allowing attackers to cement
control of the network mining. Indeed the retargeting window was several
times smaller than the tolerated timestamp drift, making the attack even
easier to launch. The attacker achieved a difficulty reduction of
99.999999%, making it approximately one billion times easier to create
blocks (low difficulty and mostly empty) and claim the mining rewards
on many more blocks than would normally be found under typical network
conditions. Lastly, due to further inheritance of code and
characteristics from a legacy network which had a completely different
architecture, Verge's consensus mechanism accepted the longest chain by
simple length without discriminating for the amount of work
accumulated. This meant that the timewarp attacker could maintain their
timeline despite much less work going into it than an honest miner's
rival timeline.