Analysis of Mining Pool Packing Attacks Faced by NEST Oracle Machine

The NEST distributed Oracle Machine improves data reliability and system security by allowing multiple parties to participate in the price determination process. To prevent malicious quoting, NEST adopts a quote-eat-order verification mechanism, allowing verifiers to trade based on quotes and propose corrections.

However, the effective operation of this mechanism relies on the timely appearance of market orders and new quotes on the chain. With the emergence of Mining Pools, the monopoly on transaction packaging rights has become a potential issue. Large Mining Pools may prioritize packaging transactions that are beneficial to themselves or have higher fees, leading to the NEST new quotes being unable to be verified in a timely manner, which may ultimately output incorrect price data.

The specific process of this Mining Pool rejecting packing attacks is as follows:

1. Before the attack, the malicious Mining Pool accumulates the cryptocurrency needed for arbitrage.

2. Submit a quote to NEST that has a significant discrepancy from the actual market price.

3. During the validation period, other validators will propose single transaction adjustments.

4. Each Mining Pool faces the choice of whether to include corrected transactions in the block.

5. The Mining Pool chooses whether to adjust the quote based on its own computing power and potential earnings.

This is essentially a static game of complete information, where the final outcome depends on the payoffs of each participant under different decision combinations. The Mining Pool needs to weigh the immediate profits gained from correcting the quotes against the potential profits from subsequent arbitrage if they do not correct.

This attack not only threatens the NEST Oracle Machine but also challenges the decentralized concept of blockchain. How to address the issues brought by the Mining Pool is an important topic on the path to achieving true decentralization.