Is There A Privacy Backdoor In Bitcoin XT?


New code advertised by Bitcoin developers Michael Hearn and Gavin Andresen has proven controversial within the Bitcoin community. Bitcoiners are now distressed over what appears to be a privacy backdoor – or bug –  in a new proposed fork. Andresen and Hearn have called the new fork “Bitcoin XT,” and designed it to take the place of the existing Bitcoin protocol.

The Bitcoin XT project apparently bans Tor nodes. Pseudonymity has been a favorite feature of Bitcoin since its introduction to the world by the unknown programmer, Satoshi Nakamoto. Whether or not Tor nodes being block is a backdoor or a bug is unclear. As a post at the Linux Foundation states:

Also Read: Bitcoin XT Block Size Increase

Bitcoin XT contains an unmentioned addition which periodically downloads lists of Tor IP addresses for blacklisting, this has considerable privacy implications for hapless users which are being prompted to use the software. The feature is not clearly described, is enabled by default, and has a switch name which intentionally downplays what it is doing (disableipprio). Furthermore these claimed anti-DoS measures are trivially bypassed and so offer absolutely no protection whatsoever.

Connections are made over clearnet even when using a proxy or onlynet=tor, which leaks connections on the P2P network with the real location of the node. Knowledge of this traffic along with uptime metrics from bitnodes.io can allow observers to easily correlate the location and identity of persons running Bitcoin nodes. Denial of service can also be used to crash and force a restart of an interesting node, which will cause them to make a new request to the blacklist endpoint via the clearnet on relaunch at the same time their P2P connections are made through a proxy. Requests to the blacklisting URL also use a custom

Bitcoin XT user agent which makes users distinct from other internet traffic if you have access to the endpoints logs.

You may review the code here.

Also Read: Reddit /R Bitcoin Suffering XT Malaise

A built-in limitation in the original Bitcoin client caps the number of transactions that are possible per second, an aspect of Bitcoin many people have said could limit its growth. For many months – indeed, years – the Bitcoin community has debated what they would like to do when too many transactions are being conducted via the old, limited code. Andresen and Hearn have taken the charge and have depended on marketing to popularize their idea for a new Bitcoin client, Bitcoin XT. Their actions have been controversial. Roger Ver weighed in on the debate today in favor of increasing the block size limit eight times.

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