Assume a malicious user wants to make bitcoins through mining. A user can create a transaction (let us assume it is a real transaction) and then create a block containing that single transaction. The malicious user then works on finding the correct nonce for that block before releasing the transaction to the network. Once the value is found, the malicious user releases the transaction. However, he/she already has valid proof of work and has the advantage over all other miners. Therefore, the malicious user can obtain the reward.

Is this scenario possible to happen?

  • I'm not quite sure I understand what you are asking. Are you asking if they can create fake coins? Where are these outputs coming from? Why are they waiting for a block to be found before "releasing the transaction"? It doesn't matter at what point a transaction occurs, or if a miner creates the transaction; all consensus rules still need to be followed. – m1xolyd1an Jun 8 '17 at 1:32
  • I think you are assuming that PoW contains only the current block hash and is independent of previous blocks. This is not the case, as the current block hash also contain a previous block hash which you have keep updating as newer blocks are found. – sanket1729 Jun 28 '17 at 1:11

What you describe is possible, but gives no advantage whatsoever to the "attacker".

Blocks build on top of their predecessor by referencing it in their header. Thus the attacker you describe would need to update his blocktemplate whenever a new blockchain tip is published. However, then he is doing exactly the same as every other mining entity, except that he's forgoing transaction fees worth one full block.

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