How to deal with dust attacks on the bitcoin network?


Translation   of   Colin Harper's  article  for Coindesk. Dust is a technical term in bitcoin that is used to refer to a small a...

Translation  of  Colin Harper's article for Coindesk.
Dust is a technical term in bitcoin that is used to refer to a small amount of satoshi in the balance of an address, which are too few to send a transaction because the commission will exceed the amount sent. Usually the dust does not exceed several hundred satoshi.
There is no reason for ordinary Bitcoin users to make such small transactions, but attackers or blockchain analytics companies can use this dust for their own purposes.
Analytical companies can de-anonymize Bitcoin wallet users in this way.
“It makes it easier to cluster addresses if the dust is combined with other user funds,” Sergey Kotlyar, CEO of Bitrefill, said in a comment for Coindesk.
Unless users are pooled unspent transaction outputs (UTXOs), they don't need to worry about their anonymity. However, most wallets combine UTXOs automatically when the user creates a transaction.
Analyst firms Chainalysis and CipherTrace have denied using the method, although Chainalysis specialist Justin Meil ​​noted that the dust is "more commonly used by investigators" to track illicit funds. Exchanges can use the dust to track stolen funds after being hacked, he said.
Dave Jevans, CEO of CipherTrace, said that "hackers can use dust to identify potential victims of phishing or extortion."
Some wallets like Samourai and Bitcoin Core allow UTXOs to be frozen, which prevents them from being combined into a new transaction. But Kotlyar stressed that most ordinary users will not use this feature.
To reduce the impact of dust on the network, Kotlyar proposed to increase its limit, which is set in Bitcoin Core. Currently, most wallets cap transactions at 546 satoshi (0.00000546 BTC).
"It would be censorship to block such transactions, but an increase in the dust limit could be considered," Kotlyar said, adding that his proposal "is a way to raise the debate on this issue."
If this limit were increased, the cost of the “dust attack” would have increased significantly. But this, of course, will hurt honest users who spend small amounts. If Bitcoin rises in price significantly, then the dust limit will need to be re-calibrated.
“In bitcoin, we have no way to censor what we don't like, but we can change these defaults to make them more expensive,” Kotlyar said.
Another update, proposed by Bitcoin Core developer Peter Todd, includes the elimination of dusty UTXOs in CoinJoin transactions to maintain privacy. A Samourai spokesperson said the wallet developers are considering adding such a feature in the future.
However, there is no guarantee that raising the limit will solve this dust attack problem forever.
This "will definitely [be] a deterrent," according to OXT Research analyst Ergo, but blockchain analysts will still be willing to pay to send dust (if the limit is raised), especially if they have large contracts with government agencies.
But this can shield the bitcoin blockchain from small transactions of intruders. The dust takes up block space that could be used to house larger transactions.
For example, in the most recent dust attack, Ergo tracked about 84,000 exits from 146 transactions. These transactions appear to be advertised by the little-known Bitcoin SV messaging app. Each transaction includes a message with a link to the application. According to Ergo, BSV supporters spent about 1.147 BTC on this “ad campaign”.

Cryptocurrency Magazine - Crypto Market Updates: How to deal with dust attacks on the bitcoin network?
How to deal with dust attacks on the bitcoin network?
Cryptocurrency Magazine - Crypto Market Updates
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