Cardano developer Input Output has announced a major security-enhancing upgrade called “Ouroboros Phalanx.”
This upgrade is in the final stages of testing and is intended to resolve grinding attacks.
One of the leading proof-of-stake blockchains will also become more efficient after implementing an upgrade.
How the crushing attack works
The network randomly chooses who can get the best block. However, if someone controls a large amount of ADA tokens (say 20% or more), they may be able to manipulate the randomness.
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This can be achieved by quickly testing different ‘random seeds’ to ensure the maximum number of winning slots. Malicious actors can delay transactions, censor blocks, and double-spend.
new crypto puzzle
Phalanx makes polishing attacks, considered the most dangerous class of PoS attacks, much harder to perform by adding a Verifiable Delay Function (VDF).
Cryptographic puzzles require real-time and computational effort to solve, so there are no shortcuts.
Therefore, a malicious attacker will no longer be able to instantly “smash” random possibilities. Every attempt requires performing some really heavy calculations. A new upgrade prevents attackers from cheaply manipulating the randomness of leader selection.
In particular, the randomness that determines who generates blocks now evolves over two epochs (approximately 10 days).
This upgrade not only provides a higher level of security, but also ensures faster transactions and better decentralization.
Phalanx will be rolled out through a hard fork because core protocol changes cannot be rolled out with simple parameter adjustments.
