Analysis of Mining Pool Refusal to Package Attacks Faced by NEST Oracle Machine

The NEST distributed Oracle Machine aims to enhance data reliability and system security by allowing more on-chain users to participate in the price conversion relationship determination process. However, this mechanism also faces some challenges, one of which is the potential for Mining Pools to conduct denial-of-packaging attacks.

NEST adopts a quote-taking submission verification mechanism to limit malicious quoting and make timely corrections. However, the effective operation of this mechanism relies on the timely appearance of taking orders and new quote transactions in the new blocks on the chain. However, with the emergence of Mining Pools, the monopoly of individual miners or pools over transaction packaging rights has become a potential issue.

Large mining pools often possess greater computing power, allowing them to prioritize packaging transactions that are advantageous to themselves or have higher transaction fees. When this situation occurs in the NEST oracle machine, it may lead to new quotes not being verified in a timely manner during the verification period, ultimately causing the NEST to output incorrect price data, creating arbitrage opportunities for certain mining pools, thereby threatening the security of the entire DeFi ecosystem.

The attack process is roughly as follows:

1. Malicious Mining Pools hoard cryptocurrencies for arbitrage in advance through methods such as flash loans.
2. Submit a quote to NEST that has a significant difference from the actual market price.
3. During the verification period, other validators will propose single transaction eats and make corrections to the quotes.
4. The mining pool may choose not to package these corrected transactions into a new block, thereby delaying or preventing the update of the quotes.
5. Ultimately, erroneous price data may be adopted, allowing malicious Mining Pools to profit.

This attack is essentially a multi-party game. Each Mining Pool decides whether to participate in correcting the quote based on its own hash rate share and potential profits. If they choose to correct, the Mining Pool may immediately gain a certain profit; if they do not correct, they may obtain greater profits through arbitrage after the erroneous quote is established.

However, only the mining pool that successfully mines a new block can obtain the right to account, so the actual earnings of each mining pool are proportional to its computing power. This complex game will ultimately reach a Nash equilibrium state, determining whether the bid is corrected in a timely manner.

The refusal of Mining Pools to pack attacks is not only a challenge faced by the NEST Oracle Machine, but it also reflects a broader issue confronting the entire decentralized concept of blockchain. Effectively addressing the potential threats posed by Mining Pools while maintaining decentralization will be an important challenge on the path of blockchain technology development. In the future, we need to explore more innovative mechanisms to balance efficiency, security, and the degree of decentralization in order to build a healthier and more sustainable blockchain ecosystem.