Researchers Have Pointed Out Vulnerable Areas in Bitcoin’s L2

The University of Illinois Researchers claimed to have found vulnerabilities in Bitcoin’s Lightning Network. They claimed further that it has the potential of resulting in a theft that could cost 750 BTC, approximately $18 million.

Timely Discoveries

The researchers involved in the latest finding, Anastasios Sidiropoulos, and Cosimo Sguanci, released a joint paper. It was in the paper that they explicated the issue they discovered with the Layer 2 platform. They utilized a hypothetical scenario where certain malware nodes could combine to carry out an attack.

They said a combination of about 30 nodes could lock in 31 percent of funds on the channels for a period of two months. The researchers said the nodes would be able to carry this out through what they called a zombie attack. They would then be able to steal over 750 Bitcoin through a massive double spend attack.

The researchers’ paper defined a zombie attack as a type of vandalism that crowds the network. It, therefore, renders the lightning network useless. In a zombie attack, certain nodes will become unresponsive, and funds connected to them will become locked. 

The researchers said the only remedy to this would be for the correct node to close its channel and go back to Bitcoin’s L1 network. That process will, however, cost a lot of transaction fees. 

There was another form of attack the researchers claimed to have identified. It is called the Double Spend Attack. This attack will need the cooperation of many bad nodes to overwhelm Bitcoin’s L1 blockchain with closing transactions containing fraud.

The Need for Better Maintenance

If it happens that the attackers pay the huge fees caused by the network’s crowding, then they will skip the line and double-spend Bitcoin. The attack is possible when there is a gap in the lightning network watchtower configuration.

The role of the watchtower is to track the condition of the lightning network and also keeps every data regularly used during transactions. The transactions are also referred to as justice transactions.

The real nodes need to present justice transactions in order to counter any request that might be fraudulent. If every watchtower then work well, it will be easy to determine any fraudulent request.

A watchtower that isn’t maintained properly might give the right entry point for an attack involving double-spend. And it will affect the attack victims significantly.