How Does a Threshold Signature Scheme Prevent a Malicious Node from Submitting False Data?
A malicious node cannot submit false data because it cannot generate a valid threshold signature on its own. It needs the cooperation of T-1 other honest nodes to reach the required threshold.
Since the honest nodes will not sign a false price, the malicious node's attempt to submit corrupted data will fail the on-chain signature verification check, preventing the false data from being accepted.
Glossar
Signature Scheme
Authentication ⎊ A signature scheme, within cryptocurrency and financial derivatives, establishes verifiable digital consent to a transaction or contract, functioning as a cryptographic commitment from an entity.
Threshold
Barrier ⎊ A threshold, within cryptocurrency derivatives and options trading, fundamentally represents a price level that must be breached for a contract to become active or trigger a specific outcome.
Threshold Signature Scheme
Signing Protocol ⎊ Threshold Signature Scheme is the specific implementation of threshold cryptography that dictates how multiple private key fragments combine to produce a single, valid digital signature required to approve a transaction or execute a derivative settlement instruction.
False Data
Provenance ⎊ False data within cryptocurrency, options, and derivatives markets frequently originates from compromised data feeds or manipulated reporting mechanisms, impacting price discovery and risk assessment.
Node
Entity ⎊ A Node is an individual participant computer that validates transactions, maintains a copy of the ledger, and contributes to the overall security and decentralization of the cryptocurrency Network.
Threshold Signature
Signature ⎊ The resulting cryptographic output generated when a minimum number of authorized parties combine their key shares to authorize a specific transaction or message.