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Bitcoin Gold hit by 51% attacks, $72K in cryptocurrency double-spent

342 points by scalableUnicon 7y ago

pwinnski 7y ago
This is good for Bitcoin. /s
- tgsovlerkhgsel 7y ago
  Surprisingly, all cryptos (including BTG) seem to be going up. Normally a 51% attack on any somewhat-known cryptocurrency pushes the price down. This kinda confirms that BTG being not just susceptible to 51% attacks but also getting hit by them isn't a surprise to anyone. Edit to add: For anyone not familiar with the space, Bitcoin Gold is one of the many forks of the main Bitcoin blockchain, and one of the least meaningful among the ones commonly known. Here's the map of the main forks: https://i.redd.it/1pvmr98w5x041.png https://i.redd.it/1pvmr98w5x041.png -- the main chain is by far the most known/popular/valuable, followed by Cash and SV in this order, followed by Gold far behind the rest. Useful metrics are value/market cap, number/size of exchanges supporting it, or hash power. Hash power roughly correlates with value. A main-chain Bitcoin (BTC) is worth about $8750 and basically the reserve currency of the crypto world (roughly all exchanges will have it), Bitcoin Cash (BCH) about $370 and has 400+ markets (that's as much as Coinmarketcap will show), Bitcoin SV (BSV) about $300 and 154 markets, Bitcoin Gold about $12 and 74 markets. Too lazy to count unique exchanges (an exchange can have multiple markets per coin). Edit: Exchange listing counts here https://news.ycombinator.com/item?id=22161472 https://news.ycombinator.com/item?id=22161472
  - chrisco255 7y ago
    Because most cryptos are traded in terms of BTC or ETH, if either of those two go up, virtually all other coins tend to rise as well. I haven't seen altcoins decoupled since 2017.
  - derefr 7y ago
    I feel like every attack on these networks that goes from theoretical to real (or that gets demonstrated on increasingly larger scales), will actually tend to cause the market to get more bullish on the ecosystem as a whole. It’s a kind of de-risking—not in the sense that the particular blockchain, or blockchains in general, are now any less vulnerable to the attack (Sybil attacks generally are like the Halting Problem of open consensus systems—no real way around them) but rather that these attacks, for some investors, go from scary “unknown unknowns” to “known unknowns” that can be quantified in their impact, and thus ROI models can be clarified, making cryptocurrency’s value as an asset class more legible. Legible assets always have a place in a hybrid-strategy portfolio; while illegible assets (like illiquid real estate from the housing crash) almost never do. > basically the reserve currency of the crypto world (roughly all exchanges will have it) I would say that that’s more like either Monero or USDC right now: these are the cryptocurrencies people ask for when they just want cash but want to let you pay them in crypto, because you can cash out of crypto entirely in a non-value-losing way pretty well from either (with Monero, because it has low TX fees and fast processing times, so you can get rid of it in seconds; with USDC, because it’s stable-ish for now, so you don’t need to worry on a scale of minutes whether it’ll keep its value.) Which is similar to what “reserve currency” means in practice for most people (other than banks): it’s the currency they’d prefer to be paid in, and the currency you’ll see them trading in their own currency for in the event that their own currency experiences high volatility.
    - xiphias2 7y ago
      You are right, I remember talking to Bitcoin core and lightning network developers before the segwit/bitcoin cash fork. They were quite depressed as the social/marketing attacks on Bitcoin core were quite successful in hindering Bitcoin's development by a few years. At the same time as Bitcoin core won (by market share), now Bitcoin is a state where everybody accepts that Bitcoin won't have any hard forks in the future (even if it would be technically warranted). For many things change is a good thing, but for creating a new monetary system it's only good if it fixes a huge flaw in the previous one (unlimited money supply and limited international money flow in the case of the current financial system).
  - lawlessone 7y ago
    >Surprisingly, all cryptos (including BTG) seem to be going up This might be because the "halvening" is this year. Also all stocks are down due to the corona virus. which is allegedly a reason bitcoin is high.
    - endorphone 7y ago
      There is zero rational basis for any movement in cryptocurrencies, and it was spiking at the same time that the normal stock market was hitting record highs. Rationally, bitcoin should be worth close to nothing.
      - lawlessone 7y ago
        you're probably right.
      - shawnz 7y ago
        You mean just like gold?
        endorphone 7y ago
        Gold has intrinsic high value in an enormous number of processes, and is a physically very rare element with very novel properties. Cryptocurrency isn't remotely rare -- one can create a hundred Bitcoin clones in an afternoon -- and has zero fundamental value. It solves no real problem, and is worse at virtually everything than alternatives. The comparison with gold has always been specious. If a tiny, tiny fraction of holders of bitcoin liquidated to cash, it would be worth close to nothing overnight.
        shawnz 7y ago
        Gold's intrinsic value is obviously nowhere near its value on the market. Bitcoin does have some intrinsic value too as an international payments system, which like gold clearly is not the only driver of the price. Furthermore I don't see how you can compare the rarity of gold versus bitcoins. What makes one "more rare" or "less rare" than the other? Are we comparing grams to bits, or what? > If a tiny, tiny fraction of holders of bitcoin liquidated to cash, it would be worth close to nothing overnight. Being opposed to Bitcoin because you think it's too volatile is a totally different argument than "its value isn't defined intrinsically".
- fabianfabian 7y ago
  Well it is, any copy cat coin sharing the same hashing algorithm as Bitcoin has this risk. So stay away from shitcoins. Edit: I was wrong about BTG sharing the same algorithm.
  - brokensegue 7y ago
    I don't think Bitcoin gold uses the same hash function as Bitcoin
    - latchkey 7y ago
      Correct, it uses equihash [1]. [1] https://bitcoingold.org/equihash-btg/ https://bitcoingold.org/equihash-btg/
  - abstractbarista 7y ago
    I think it's more complicated than that. You'd need enough computing resources to "beat" half of the Bitcoin network's current hashrate, which is absolutely massive compared to BTG's. Oops: I see what you mean though. Because there's so many BTC miners, they can easily swap over to BTG to overwhelm the much smaller network.
    - martindale 7y ago
      This is part of the reason why it's most likely everything will converge on a single money. Currencies will be issued on top, rather than dividing the global effort.
  - Tepix 7y ago
    Equihash is not SHA-256.
  - deleted 7y ago
    [deleted]
  - consp 7y ago
    Every coin which uses the same proof of work method has this problem. It is independent of the actual hashing algorithm used. This is also not the first time this coin has been targeted.
- mywittyname 7y ago
  This is sarcasm, but it really is: with crypto, there's strength in numbers.
  - Proven 7y ago
    That's right - hackers can't attack cryptos as fast as scammers can fork 'em and create ever new Ponzis
piker 7y ago
Note this is "Bitcoin Gold", not Bitcoin.
- Krasnol 7y ago
  Funny how the whole article talks about Bitcoin Gold (BTG) but some automatic script liked Bitcoin (BTC) right in the first sentence. I wonder if anybody checks those articles after they've been posted or are those already automatically generated?
  - sp332 7y ago
    The linked-to affiliate doesn't support BTG https://bitcoinist.com/etoro-exchange-clarify-position-on-bitcoin2x-and-bitcoin-gold/ https://bitcoinist.com/etoro-exchange-clarify-position-on-bi...
- astrodust 7y ago
  This is just a warm-up for taking on Bitcoin.
  - redisman 7y ago
    The scale would be orders of magnitude bigger.
    - astrodust 7y ago
      So? That just makes it harder, not impossible. This vulnerability was baked into Bitcoin from day one. There is no outcome under which Bitcoin is not 51% attacked. it is an inevitability as sure as the heat-death of the universe.
  - gnulinux 7y ago
    I doubt any single party owns enough compute to perform 51% attack on Bitcoin. Not now, maybe in the future if bitcoin's popularity significantly dies, they can do that.
m3kw9 7y ago
Looks like they took a loss doing that attCk
- bdcravens 7y ago
  There are a lot of Bitcoin advocates that would attack out of motivations other than (short-term) profit.
dajohnson89 7y ago
i wonder if this will cause a fork.
- deleted 7y ago
  [deleted]
- deleted 7y ago
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- sp332 7y ago
  No, this won't cause a fork. To be specific, little forks happen all the time as different clients get information about new blocks at different times. So blockchains are very resilient to that kind of thing. Clients only continue from the longest legit chain they have seen, so whichever side of the fork has more hashpower on it will win in a way that's pretty transparent. So the attacker did cause a fork, so that they could spend coins once on each side, but all clients other than the attackers' would agree on which side was legitimate. So once the attack is over, it settles down immediately.
  - joosters 7y ago
    It was a fork! That's how the double spends work. The attackers generated a new chain of blocks from just before their transaction, and produced their chain so fast that it became longer than the 'real' chain, causing miners to accept it as the legitimate record of all transactions. As for 'resilient', try telling that to the people who were robbed of their coins because of this attack!
propter_hoc 7y ago
Second time this has happened to BTG. Boggles the mind that people continued to use this coin. https://fortune.com/2018/05/29/bitcoin-gold-hack/ https://fortune.com/2018/05/29/bitcoin-gold-hack/
- aeyes 7y ago
  Do other coins have any countermeasures against this? Other than it being expensive to control 51% of the networks hash rate? I guess raising the amount of required confirmations helps but even then it's just a matter of time.
  - spir 7y ago
    Yes, Ethereum is transitioning to proof of stake. Proof of stake is more secure than proof of work because an attacker must acquire a large amount of ETH each time they attempt an attack. Attacks against proof of stake are incredibly capital-inefficient.
    - marketingfool 7y ago
      That's absolutely not true. Heck proof of stake is significantly less secure because you can have stakes working together to game the system.
    - nullc 7y ago
      Ethereum has been announcing "proof of stake" since before their original launch. Yet, years after their deadline and their second deadline and their third deadline... it still isn't there. Multiple hardforks to push back the logic bomb in their consensus rules that was originally supposed to guarantee its successful deployment... Now their target has been to create a new parallel cryptocurrency (eth2) and let you buy into it with your eth. If your goal is a decentralized system POS is just a fundamentally broken idea, as was known years ago (and long before ethereum existed https://download.wpsoftware.net/bitcoin/pos.pdf https://download.wpsoftware.net/bitcoin/pos.pdf ). Ethereum isn't a decentralized system-- as demonstrated by them editing balances to recover coins the ETH administrators personally lost by gambling on an ill-advised contract-- but they have to keep up the pretext.
est31 7y ago
> He then provided a screenshot showing that Binance had since increased their BTG withdrawal requirement to 20 confirmations. The journalist has missed an important part of the github gist that their story bases on: > Based on Nicehash market price data for Zhash we estimate the cost of generating each reorg at around 0.2 BTC (~$1,700) and the attacker would have recouped around the same value in block rewards. Therefore, it is possible that the attacks were profitable if the double-spends succeeded at defrauding the attacker's counterparty, or break-even if the double-spends were unsuccessful. This suggests that a confirmation requirement on the order of tens of blocks for BTG is still far too few to make the budget constraint to launch an attack significant.
- Misdicorl 7y ago
  Double spends are an inefficient way to profit from an attack, they're merely the advertising/marketing angle. The real profit will come from shorting the currency and capitalizing on the subsequent crash due to the crisis in confidence.
  - wmf 7y ago
    If you can short such an obscure coin and if there's a crash. Sometimes these attacks are already priced in.
    - snarf21 7y ago
      I think the point they were making is that you keep double spending until it does. You profit or you profit very very big. It doesn't seem like news of a double spend would ever cause a pop.
      - wmf 7y ago
        I would expect the probability of a crash to go down with each attack. The first attack is novel but the nth is not.
      - johnbrodie 7y ago
gruez 7y ago
Note there are plenty of other cryptocurrencies that are susceptible. https://www.crypto51.app/ https://www.crypto51.app/
- dang 7y ago
  Current discussion at https://news.ycombinator.com/item?id=22160523 https://news.ycombinator.com/item?id=22160523 Also in 2018: https://news.ycombinator.com/item?id=17173051 https://news.ycombinator.com/item?id=17173051
drcode 7y ago
ELI5: Lots of cyptocurrencies use the same mining algorithm, i.e. they require the same type of puzzle to be solved to make money creating blocks. In recent years, lots of online services have sprung up to offer cloud mining, which people usually use to mine blocks on the bigger cryptocurrencies, like Bitcoin Core or Bitcoin Cash. However, since the smaller cryptocurrencies, like Bitcoin Gold, have less users/miners, they also require easier "puzzles" to be solved, which opens an opportunity for any random person to pay some $$$ to hire a bunch of these cloud servers for a limited time and point them at these easier puzzles, which can cause such a smaller blockchain to get confused about account balances. The attacker can then re-spend the same currency multiple times to make a profit. AFAIK there aren't really any good solutions to prevent this problem- For complex game-theoretic reasons, simply changing the mining algorithm to something different doesn't really offer much protection. (Some folks believe if these smaller currencies were to move to "proof of stake" it could help solve this problem, but this is an extremely contentious topic.)
- makotech222 7y ago
  The good solution is to not use such a dumb technology to represent money.
- 3pt14159 7y ago
  And it isn't like this problem wasn't foreseen ahead of time. I repeatedly tried to convince people that it was a real issue back seven or so years ago only to be met with (apparent[0]) scepticism that it's a real attack vector. [0] Lots of millionaires came out of the cryptocurrency era. Sock puppets are cheap in comparison.
  - spir 7y ago
    > cryptocurrency era Cryptocurrencies and their associated boom-bust market cycles are here to stay. 95% of blockchain development happens on Ethereum, and Ethereum is growing well, https://medium.com/@jjmstark/the-year-in-ethereum-2019-242012e4276d https://medium.com/@jjmstark/the-year-in-ethereum-2019-24201..., so the idea that there was a cryptocurrency era that's ended is not true.
knocte 7y ago
I wonder why this ended up in the front page of HackerNews? It's not news that altcoins are much much easier to attack than the top coin(s). Lesson to learn here: top coins are not only better due to the network effects (users and developers), they are also better in terms of security (it's much more expensive to carry out an attack in BTC or ETH, for example).
- xyst 7y ago
  Would it be fair to say altcoins are the “penny stocks” of the cryptocurrency world? Easily subjected to price manipulation and typically the perpetrator doesn’t have to spend too much.
  - knocte 7y ago
    I think altcoins are not even penny stocks, they will die soon in the same way there are no other networks these days that try to be the internet. The penny stocks are the Ethereum tokens.
- rudolph9 7y ago
  When I first read it, I read "Bitcoin Cash" which stuck me as alarming as it's one of the larger ones. But upon further investigation realized that it's "Bitcoin Gold" something I have no recollection of.
  - knocte 7y ago
    I don't consider Bitcoin Crash as one of the larger ones (it possibly has less than 5% of BTC's hashpower).
    - bdcravens 7y ago
      As in all things cryptocurrency related, when most people are talking about the biggest coins, they are talking about trading price and volume. You'd do well to frame your discussions about cryptocurrency from the HN perspective, not that of a BTC-enthusiast or -maximist. Using derisive terms like "Bitcoin Crash" really doesn't add to the conversation. Like I said in another comment, this isn't Reddit.
milansuk 7y ago
The block which includes double-spent is invalid. When an honest node chooses the "strongest" chain it should check block If it's valid, not just look at a number of confirmations. This is also true for blockchain browsers(and their api), which apps use to confirm the transaction(most of users don't run full node). The only way how 51% attack can be successful in the long term is that honest nodes(and blockchain browsers api) are re-configure to ignore double-spent(at least for a particular time period).
- wcoenen 7y ago
  How do you know which side of a blockchain fork is the double spent, and which is the original?
  - milansuk 7y ago
    This is a valid point. Sorry for my post. Blockchain has few moving parts, but the whole game theory around it is very complex.
- creato 7y ago
  Someone will be left holding the bag. Your post assumes it will be the double spender, there is no reason to assume that.
bobmaxup 7y ago
https://en.wikipedia.org/wiki/Sybil_attack https://en.wikipedia.org/wiki/Sybil_attack
maitredusoi 7y ago
who on earth has got Bitcoin Gold in his pocket ??? ;)
tgsovlerkhgsel 7y ago
Since the other post got buried in a subthread: This is about Bitcoin Gold, not Bitcoin itself. Bitcoin Gold is the least relevant of the forks (worth ~$12 per coin while the main chain BTC is worth ~8750 and the two major forks BCH/BSV are worth around 300, and only 7 of the 20 largest exchanges (by liquidity, according to coinmarketcap) list it - even though most of them list plenty of altcoins/shitcoins. For comparison, Bitcoin Cash is listed on all of them, Bitcoin SV on 14 of them. Additional stats here: https://news.ycombinator.com/item?id=22160458 https://news.ycombinator.com/item?id=22160458
- brokensegue 7y ago
  clearly you've never heard of Bitcoin Diamond
  - Relys 7y ago
    I prefer Bitcoin Platinum.
    - brokensegue 7y ago
      Is that real?
      - tirpen 7y ago
        I'm fairly sure it's a Pokémon joke.
        mrosett 7y ago
        Doesn't mean it's not also a cryptocurrency :)
        brokensegue 7y ago
        Idk https://cointelegraph.com/news/bitcoin-platinum-created-by-south-korean-teenager-as-a-scam-local-market-erupts https://cointelegraph.com/news/bitcoin-platinum-created-by-s...
bdcravens 7y ago
Meta: I spend a lot of time in crypto(currency) subreddits, and of course approach those conversations differently than I do when I see the same topics pop up on HN. That said, I see a lot of the Reddit-style comments and terminology ("altcoins", "shitcoins", derisive names, etc) show up where when there's a crypto discussion. Does this happen in other subjects and I'm just unaware of those topic's subcultures? Or am I correct that the level of discourse for crypto is that much lower?
- drcode 7y ago
  As someone who's been part of the crypto community since 2011, the level of discourse in most of cryptoland is rock bottom. I attribute it to the decentralized nature of the technology, which encourages lots of people to attempt manipulate prices through trolling.
  - bdcravens 7y ago
    I would concur (I've been around it a similar amount of time, building my first GPU rigs around that time). I would say it was once a bit better, but maybe that's just rose-tinted nostalgia. ("the good ole days")
    - drcode 7y ago
      Yeah, in the early days it was better... I would argue that the average IQ in the community around 2011-2013 was unusually high: The reason some of the people who bought currency in that time period made a fortune is because they foresaw the future and had a prescience that other people lacked (others just got lucky)
      - untoreh 7y ago
        its quite comparable to the web...as it got more widespread the density of likeminded people adjusted to the true average...this does not mean there are no more good places to talk and develop cc, just they are clouded by all the noise above board.
dang 7y ago
A current thread about 51% attacks is here: https://news.ycombinator.com/item?id=22160523 https://news.ycombinator.com/item?id=22160523
- jackalo 7y ago
  That is a thread about the cost for a 51% attack against various crypto currencies, not about Bitcoin Gold actually being hit.
  - dang 7y ago
    Yes, that's why we didn't merge the two threads.
TazeTSchnitzel 7y ago
> Binance had since increased their BTG withdrawal requirement to 20 confirmations. Perhaps they should require some multiple of (amount of the transfer / cost of the hashpower needed to mine one block)?
s_gourichon 7y ago
BTG might collapse as a result. This might help general awareness that minor coins without a differentiating technology are simply highly vulnerable uninteresting clones, not worth any attention and thus, value. Perhaps some would just disappear, in a spiral of lower value, lower hash rate, more vulnerability, till all miners leave towards other, stronger coins? This might sanitize the whole cryptocurrency domain a little. Or not?
- kybernetikos 7y ago
  It's been known for some time that anything out of the top 10 that uses a pow algorithm for which you can buy hashpower in the market is pretty easy to run a doublespend on. It doesn't seem to have had a huge effect on adoption of those coins though.
AdrianB1 7y ago
Just an observation: 51% attacks are happening there days in some countries in governments. When 51% gives you the absolute power in a bitcoin, it gives you enough to rule a country and push it to 100% (there are a few real life examples). Maybe 51% is a threshold too low for some things.
- Synaesthesia 7y ago
  That’s never really true, because even in a dictatorship the government doesn’t have total control of everything. And a 51% govt in a democratic country is constrained not only by rival political parties but also the business sector and public outrage.
  - AdrianB1 7y ago
    Just 2 words: North Korea.
redis_mlc 7y ago
Oh. Again.
latchkey 7y ago
One point nobody is hitting on is that the price of BTG pumped a few weeks ago for no apparent reason. I guess we know why now. Pump the price and then attack it for even more profit.
rootsudo 7y ago
The question now is: was hiring the cloud mining services cheaper than the reward of $72,000?
- H8crilA 7y ago
  Yes, you should try to read the article.
jb775 7y ago
1 for 1 so far on my 2020 decade predictions https://news.ycombinator.com/item?id=21943830 https://news.ycombinator.com/item?id=21943830
- Traster 7y ago
  Sorry, but this doesn't seem related to quantum - I don't think you get credit yet.
  - jb775 7y ago
    I'm aware, I was being somewhat facetious since the topic of my #1 prediction occurred so soon into the decade. Your response sounds like a pouty little kid.
H8crilA 7y ago
And all of that costed just about $1.2k, what a joke currency.
granaldo 7y ago
How disconnect the market is from facts. Price of Bitcoin Gold is not even affected by this news at all https://www.coingecko.com/en/coins/bitcoin-gold https://www.coingecko.com/en/coins/bitcoin-gold The market may not even understand what 51% is about
- runeks 7y ago
  Or maybe all buy orders have disappeared. Looking at the last exchange price does not measure the value of a cryptocurrency, you need to look inside order books to see if anyone is even interested in buying your cryptocurrency. It’s not relevant to the value of your cryptocurrency that someone was once willing to buy it.
melissa018 7y ago
Bitcoin is more than just an asset, Bitcoin has been 100x better investment than anything else in the past 10 years, you can Google it yourself. Bitcoin is both a currency and technology, and only few people understand how to maximize profits and huge returns in short period of time. I was fortunate to meet Professor Hang, a cryptocurrency expert on a Bitcoin blog online. I contacted him for guidance, we talked for while and I did subscribe to their bitcoin investment/mining program, believe it or not he made me $490,050 in just 7 weeks and i was very much impressed at his skills, and I only started with a small amount. Before I met him, I was a bit careless with security features strong passwords earlier when I started up on Coinbase and was hacked with almost 8 bitcoin stolen from my wallet, when I told him about it, he just requested for my log in and all transaction details, he traced the hackers wallet addresses they moved my coins to and extracted all my coins back from the blockchain network in just 48 hours. I had a bet with him that if he could truly get back my coins I will let the world know about him. You can drop him mail at,.. CRYPTOJACKING.WORM @ GMAIL dot COM.

pwinnski 7y ago

This is good for Bitcoin. /s

tgsovlerkhgsel 7y ago
Surprisingly, all cryptos (including BTG) seem to be going up. Normally a 51% attack on any somewhat-known cryptocurrency pushes the price down. This kinda confirms that BTG being not just susceptible to 51% attacks but also getting hit by them isn't a surprise to anyone. Edit to add: For anyone not familiar with the space, Bitcoin Gold is one of the many forks of the main Bitcoin blockchain, and one of the least meaningful among the ones commonly known. Here's the map of the main forks: https://i.redd.it/1pvmr98w5x041.png https://i.redd.it/1pvmr98w5x041.png -- the main chain is by far the most known/popular/valuable, followed by Cash and SV in this order, followed by Gold far behind the rest. Useful metrics are value/market cap, number/size of exchanges supporting it, or hash power. Hash power roughly correlates with value. A main-chain Bitcoin (BTC) is worth about $8750 and basically the reserve currency of the crypto world (roughly all exchanges will have it), Bitcoin Cash (BCH) about $370 and has 400+ markets (that's as much as Coinmarketcap will show), Bitcoin SV (BSV) about $300 and 154 markets, Bitcoin Gold about $12 and 74 markets. Too lazy to count unique exchanges (an exchange can have multiple markets per coin). Edit: Exchange listing counts here https://news.ycombinator.com/item?id=22161472 https://news.ycombinator.com/item?id=22161472
- chrisco255 7y ago
  Because most cryptos are traded in terms of BTC or ETH, if either of those two go up, virtually all other coins tend to rise as well. I haven't seen altcoins decoupled since 2017.
- derefr 7y ago
  I feel like every attack on these networks that goes from theoretical to real (or that gets demonstrated on increasingly larger scales), will actually tend to cause the market to get more bullish on the ecosystem as a whole. It’s a kind of de-risking—not in the sense that the particular blockchain, or blockchains in general, are now any less vulnerable to the attack (Sybil attacks generally are like the Halting Problem of open consensus systems—no real way around them) but rather that these attacks, for some investors, go from scary “unknown unknowns” to “known unknowns” that can be quantified in their impact, and thus ROI models can be clarified, making cryptocurrency’s value as an asset class more legible. Legible assets always have a place in a hybrid-strategy portfolio; while illegible assets (like illiquid real estate from the housing crash) almost never do. > basically the reserve currency of the crypto world (roughly all exchanges will have it) I would say that that’s more like either Monero or USDC right now: these are the cryptocurrencies people ask for when they just want cash but want to let you pay them in crypto, because you can cash out of crypto entirely in a non-value-losing way pretty well from either (with Monero, because it has low TX fees and fast processing times, so you can get rid of it in seconds; with USDC, because it’s stable-ish for now, so you don’t need to worry on a scale of minutes whether it’ll keep its value.) Which is similar to what “reserve currency” means in practice for most people (other than banks): it’s the currency they’d prefer to be paid in, and the currency you’ll see them trading in their own currency for in the event that their own currency experiences high volatility.
  - xiphias2 7y ago
    You are right, I remember talking to Bitcoin core and lightning network developers before the segwit/bitcoin cash fork. They were quite depressed as the social/marketing attacks on Bitcoin core were quite successful in hindering Bitcoin's development by a few years. At the same time as Bitcoin core won (by market share), now Bitcoin is a state where everybody accepts that Bitcoin won't have any hard forks in the future (even if it would be technically warranted). For many things change is a good thing, but for creating a new monetary system it's only good if it fixes a huge flaw in the previous one (unlimited money supply and limited international money flow in the case of the current financial system).
- lawlessone 7y ago
  >Surprisingly, all cryptos (including BTG) seem to be going up This might be because the "halvening" is this year. Also all stocks are down due to the corona virus. which is allegedly a reason bitcoin is high.
  - endorphone 7y ago
    There is zero rational basis for any movement in cryptocurrencies, and it was spiking at the same time that the normal stock market was hitting record highs. Rationally, bitcoin should be worth close to nothing.
    - lawlessone 7y ago
      you're probably right.
    - shawnz 7y ago
      You mean just like gold?
      - endorphone 7y ago
        Gold has intrinsic high value in an enormous number of processes, and is a physically very rare element with very novel properties. Cryptocurrency isn't remotely rare -- one can create a hundred Bitcoin clones in an afternoon -- and has zero fundamental value. It solves no real problem, and is worse at virtually everything than alternatives. The comparison with gold has always been specious. If a tiny, tiny fraction of holders of bitcoin liquidated to cash, it would be worth close to nothing overnight.
        shawnz 7y ago
        Gold's intrinsic value is obviously nowhere near its value on the market. Bitcoin does have some intrinsic value too as an international payments system, which like gold clearly is not the only driver of the price. Furthermore I don't see how you can compare the rarity of gold versus bitcoins. What makes one "more rare" or "less rare" than the other? Are we comparing grams to bits, or what? > If a tiny, tiny fraction of holders of bitcoin liquidated to cash, it would be worth close to nothing overnight. Being opposed to Bitcoin because you think it's too volatile is a totally different argument than "its value isn't defined intrinsically".
fabianfabian 7y ago
Well it is, any copy cat coin sharing the same hashing algorithm as Bitcoin has this risk. So stay away from shitcoins. Edit: I was wrong about BTG sharing the same algorithm.
- brokensegue 7y ago
  I don't think Bitcoin gold uses the same hash function as Bitcoin
  - latchkey 7y ago
    Correct, it uses equihash [1]. [1] https://bitcoingold.org/equihash-btg/ https://bitcoingold.org/equihash-btg/
- abstractbarista 7y ago
  I think it's more complicated than that. You'd need enough computing resources to "beat" half of the Bitcoin network's current hashrate, which is absolutely massive compared to BTG's. Oops: I see what you mean though. Because there's so many BTC miners, they can easily swap over to BTG to overwhelm the much smaller network.
  - martindale 7y ago
    This is part of the reason why it's most likely everything will converge on a single money. Currencies will be issued on top, rather than dividing the global effort.
- Tepix 7y ago
  Equihash is not SHA-256.
- deleted 7y ago
  [deleted]
- consp 7y ago
  Every coin which uses the same proof of work method has this problem. It is independent of the actual hashing algorithm used. This is also not the first time this coin has been targeted.
mywittyname 7y ago
This is sarcasm, but it really is: with crypto, there's strength in numbers.
- Proven 7y ago
  That's right - hackers can't attack cryptos as fast as scammers can fork 'em and create ever new Ponzis

piker 7y ago

Note this is "Bitcoin Gold", not Bitcoin.

Krasnol 7y ago
Funny how the whole article talks about Bitcoin Gold (BTG) but some automatic script liked Bitcoin (BTC) right in the first sentence. I wonder if anybody checks those articles after they've been posted or are those already automatically generated?
- sp332 7y ago
  The linked-to affiliate doesn't support BTG https://bitcoinist.com/etoro-exchange-clarify-position-on-bitcoin2x-and-bitcoin-gold/ https://bitcoinist.com/etoro-exchange-clarify-position-on-bi...
astrodust 7y ago
This is just a warm-up for taking on Bitcoin.
- redisman 7y ago
  The scale would be orders of magnitude bigger.
  - astrodust 7y ago
    So? That just makes it harder, not impossible. This vulnerability was baked into Bitcoin from day one. There is no outcome under which Bitcoin is not 51% attacked. it is an inevitability as sure as the heat-death of the universe.
- gnulinux 7y ago
  I doubt any single party owns enough compute to perform 51% attack on Bitcoin. Not now, maybe in the future if bitcoin's popularity significantly dies, they can do that.

m3kw9 7y ago

Looks like they took a loss doing that attCk

bdcravens 7y ago
There are a lot of Bitcoin advocates that would attack out of motivations other than (short-term) profit.

dajohnson89 7y ago

i wonder if this will cause a fork.

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sp332 7y ago
No, this won't cause a fork. To be specific, little forks happen all the time as different clients get information about new blocks at different times. So blockchains are very resilient to that kind of thing. Clients only continue from the longest legit chain they have seen, so whichever side of the fork has more hashpower on it will win in a way that's pretty transparent. So the attacker did cause a fork, so that they could spend coins once on each side, but all clients other than the attackers' would agree on which side was legitimate. So once the attack is over, it settles down immediately.
- joosters 7y ago
  It was a fork! That's how the double spends work. The attackers generated a new chain of blocks from just before their transaction, and produced their chain so fast that it became longer than the 'real' chain, causing miners to accept it as the legitimate record of all transactions. As for 'resilient', try telling that to the people who were robbed of their coins because of this attack!

propter_hoc 7y ago

Second time this has happened to BTG. Boggles the mind that people continued to use this coin. https://fortune.com/2018/05/29/bitcoin-gold-hack/ https://fortune.com/2018/05/29/bitcoin-gold-hack/

aeyes 7y ago
Do other coins have any countermeasures against this? Other than it being expensive to control 51% of the networks hash rate? I guess raising the amount of required confirmations helps but even then it's just a matter of time.
- spir 7y ago
  Yes, Ethereum is transitioning to proof of stake. Proof of stake is more secure than proof of work because an attacker must acquire a large amount of ETH each time they attempt an attack. Attacks against proof of stake are incredibly capital-inefficient.
  - marketingfool 7y ago
    That's absolutely not true. Heck proof of stake is significantly less secure because you can have stakes working together to game the system.
  - nullc 7y ago
    Ethereum has been announcing "proof of stake" since before their original launch. Yet, years after their deadline and their second deadline and their third deadline... it still isn't there. Multiple hardforks to push back the logic bomb in their consensus rules that was originally supposed to guarantee its successful deployment... Now their target has been to create a new parallel cryptocurrency (eth2) and let you buy into it with your eth. If your goal is a decentralized system POS is just a fundamentally broken idea, as was known years ago (and long before ethereum existed https://download.wpsoftware.net/bitcoin/pos.pdf https://download.wpsoftware.net/bitcoin/pos.pdf ). Ethereum isn't a decentralized system-- as demonstrated by them editing balances to recover coins the ETH administrators personally lost by gambling on an ill-advised contract-- but they have to keep up the pretext.

est31 7y ago

> He then provided a screenshot showing that Binance had since increased their BTG withdrawal requirement to 20 confirmations. The journalist has missed an important part of the github gist that their story bases on: > Based on Nicehash market price data for Zhash we estimate the cost of generating each reorg at around 0.2 BTC (~$1,700) and the attacker would have recouped around the same value in block rewards. Therefore, it is possible that the attacks were profitable if the double-spends succeeded at defrauding the attacker's counterparty, or break-even if the double-spends were unsuccessful. This suggests that a confirmation requirement on the order of tens of blocks for BTG is still far too few to make the budget constraint to launch an attack significant.

Misdicorl 7y ago
Double spends are an inefficient way to profit from an attack, they're merely the advertising/marketing angle. The real profit will come from shorting the currency and capitalizing on the subsequent crash due to the crisis in confidence.
- wmf 7y ago
  If you can short such an obscure coin and if there's a crash. Sometimes these attacks are already priced in.
  - snarf21 7y ago
    I think the point they were making is that you keep double spending until it does. You profit or you profit very very big. It doesn't seem like news of a double spend would ever cause a pop.
    - wmf 7y ago
      I would expect the probability of a crash to go down with each attack. The first attack is novel but the nth is not.
    - johnbrodie 7y ago

gruez 7y ago

Note there are plenty of other cryptocurrencies that are susceptible. https://www.crypto51.app/ https://www.crypto51.app/

dang 7y ago
Current discussion at https://news.ycombinator.com/item?id=22160523 https://news.ycombinator.com/item?id=22160523 Also in 2018: https://news.ycombinator.com/item?id=17173051 https://news.ycombinator.com/item?id=17173051

drcode 7y ago

ELI5: Lots of cyptocurrencies use the same mining algorithm, i.e. they require the same type of puzzle to be solved to make money creating blocks. In recent years, lots of online services have sprung up to offer cloud mining, which people usually use to mine blocks on the bigger cryptocurrencies, like Bitcoin Core or Bitcoin Cash. However, since the smaller cryptocurrencies, like Bitcoin Gold, have less users/miners, they also require easier "puzzles" to be solved, which opens an opportunity for any random person to pay some $$$ to hire a bunch of these cloud servers for a limited time and point them at these easier puzzles, which can cause such a smaller blockchain to get confused about account balances. The attacker can then re-spend the same currency multiple times to make a profit. AFAIK there aren't really any good solutions to prevent this problem- For complex game-theoretic reasons, simply changing the mining algorithm to something different doesn't really offer much protection. (Some folks believe if these smaller currencies were to move to "proof of stake" it could help solve this problem, but this is an extremely contentious topic.)

makotech222 7y ago
The good solution is to not use such a dumb technology to represent money.
3pt14159 7y ago
And it isn't like this problem wasn't foreseen ahead of time. I repeatedly tried to convince people that it was a real issue back seven or so years ago only to be met with (apparent[0]) scepticism that it's a real attack vector. [0] Lots of millionaires came out of the cryptocurrency era. Sock puppets are cheap in comparison.
- spir 7y ago
  > cryptocurrency era Cryptocurrencies and their associated boom-bust market cycles are here to stay. 95% of blockchain development happens on Ethereum, and Ethereum is growing well, https://medium.com/@jjmstark/the-year-in-ethereum-2019-242012e4276d https://medium.com/@jjmstark/the-year-in-ethereum-2019-24201..., so the idea that there was a cryptocurrency era that's ended is not true.

knocte 7y ago

I wonder why this ended up in the front page of HackerNews? It's not news that altcoins are much much easier to attack than the top coin(s). Lesson to learn here: top coins are not only better due to the network effects (users and developers), they are also better in terms of security (it's much more expensive to carry out an attack in BTC or ETH, for example).

xyst 7y ago
Would it be fair to say altcoins are the “penny stocks” of the cryptocurrency world? Easily subjected to price manipulation and typically the perpetrator doesn’t have to spend too much.
- knocte 7y ago
  I think altcoins are not even penny stocks, they will die soon in the same way there are no other networks these days that try to be the internet. The penny stocks are the Ethereum tokens.
rudolph9 7y ago
When I first read it, I read "Bitcoin Cash" which stuck me as alarming as it's one of the larger ones. But upon further investigation realized that it's "Bitcoin Gold" something I have no recollection of.
- knocte 7y ago
  I don't consider Bitcoin Crash as one of the larger ones (it possibly has less than 5% of BTC's hashpower).
  - bdcravens 7y ago
    As in all things cryptocurrency related, when most people are talking about the biggest coins, they are talking about trading price and volume. You'd do well to frame your discussions about cryptocurrency from the HN perspective, not that of a BTC-enthusiast or -maximist. Using derisive terms like "Bitcoin Crash" really doesn't add to the conversation. Like I said in another comment, this isn't Reddit.

milansuk 7y ago

The block which includes double-spent is invalid. When an honest node chooses the "strongest" chain it should check block If it's valid, not just look at a number of confirmations. This is also true for blockchain browsers(and their api), which apps use to confirm the transaction(most of users don't run full node). The only way how 51% attack can be successful in the long term is that honest nodes(and blockchain browsers api) are re-configure to ignore double-spent(at least for a particular time period).

wcoenen 7y ago
How do you know which side of a blockchain fork is the double spent, and which is the original?
- milansuk 7y ago
  This is a valid point. Sorry for my post. Blockchain has few moving parts, but the whole game theory around it is very complex.
creato 7y ago
Someone will be left holding the bag. Your post assumes it will be the double spender, there is no reason to assume that.

bobmaxup 7y ago

https://en.wikipedia.org/wiki/Sybil_attack https://en.wikipedia.org/wiki/Sybil_attack

maitredusoi 7y ago

who on earth has got Bitcoin Gold in his pocket ??? ;)

tgsovlerkhgsel 7y ago

Since the other post got buried in a subthread: This is about Bitcoin Gold, not Bitcoin itself. Bitcoin Gold is the least relevant of the forks (worth ~$12 per coin while the main chain BTC is worth ~8750 and the two major forks BCH/BSV are worth around 300, and only 7 of the 20 largest exchanges (by liquidity, according to coinmarketcap) list it - even though most of them list plenty of altcoins/shitcoins. For comparison, Bitcoin Cash is listed on all of them, Bitcoin SV on 14 of them. Additional stats here: https://news.ycombinator.com/item?id=22160458 https://news.ycombinator.com/item?id=22160458

brokensegue 7y ago
clearly you've never heard of Bitcoin Diamond
- Relys 7y ago
  I prefer Bitcoin Platinum.
  - brokensegue 7y ago
    Is that real?
    - tirpen 7y ago
      I'm fairly sure it's a Pokémon joke.
      - mrosett 7y ago
        Doesn't mean it's not also a cryptocurrency :)
      - brokensegue 7y ago
        Idk https://cointelegraph.com/news/bitcoin-platinum-created-by-south-korean-teenager-as-a-scam-local-market-erupts https://cointelegraph.com/news/bitcoin-platinum-created-by-s...

bdcravens 7y ago

Meta: I spend a lot of time in crypto(currency) subreddits, and of course approach those conversations differently than I do when I see the same topics pop up on HN. That said, I see a lot of the Reddit-style comments and terminology ("altcoins", "shitcoins", derisive names, etc) show up where when there's a crypto discussion. Does this happen in other subjects and I'm just unaware of those topic's subcultures? Or am I correct that the level of discourse for crypto is that much lower?

drcode 7y ago
As someone who's been part of the crypto community since 2011, the level of discourse in most of cryptoland is rock bottom. I attribute it to the decentralized nature of the technology, which encourages lots of people to attempt manipulate prices through trolling.
- bdcravens 7y ago
  I would concur (I've been around it a similar amount of time, building my first GPU rigs around that time). I would say it was once a bit better, but maybe that's just rose-tinted nostalgia. ("the good ole days")
  - drcode 7y ago
    Yeah, in the early days it was better... I would argue that the average IQ in the community around 2011-2013 was unusually high: The reason some of the people who bought currency in that time period made a fortune is because they foresaw the future and had a prescience that other people lacked (others just got lucky)
    - untoreh 7y ago
      its quite comparable to the web...as it got more widespread the density of likeminded people adjusted to the true average...this does not mean there are no more good places to talk and develop cc, just they are clouded by all the noise above board.

dang 7y ago

A current thread about 51% attacks is here: https://news.ycombinator.com/item?id=22160523 https://news.ycombinator.com/item?id=22160523

jackalo 7y ago
That is a thread about the cost for a 51% attack against various crypto currencies, not about Bitcoin Gold actually being hit.
- dang 7y ago
  Yes, that's why we didn't merge the two threads.

TazeTSchnitzel 7y ago

> Binance had since increased their BTG withdrawal requirement to 20 confirmations. Perhaps they should require some multiple of (amount of the transfer / cost of the hashpower needed to mine one block)?

s_gourichon 7y ago

BTG might collapse as a result. This might help general awareness that minor coins without a differentiating technology are simply highly vulnerable uninteresting clones, not worth any attention and thus, value. Perhaps some would just disappear, in a spiral of lower value, lower hash rate, more vulnerability, till all miners leave towards other, stronger coins? This might sanitize the whole cryptocurrency domain a little. Or not?

kybernetikos 7y ago
It's been known for some time that anything out of the top 10 that uses a pow algorithm for which you can buy hashpower in the market is pretty easy to run a doublespend on. It doesn't seem to have had a huge effect on adoption of those coins though.

AdrianB1 7y ago

Just an observation: 51% attacks are happening there days in some countries in governments. When 51% gives you the absolute power in a bitcoin, it gives you enough to rule a country and push it to 100% (there are a few real life examples). Maybe 51% is a threshold too low for some things.

Synaesthesia 7y ago
That’s never really true, because even in a dictatorship the government doesn’t have total control of everything. And a 51% govt in a democratic country is constrained not only by rival political parties but also the business sector and public outrage.
- AdrianB1 7y ago
  Just 2 words: North Korea.

redis_mlc 7y ago

Oh. Again.

latchkey 7y ago

One point nobody is hitting on is that the price of BTG pumped a few weeks ago for no apparent reason. I guess we know why now. Pump the price and then attack it for even more profit.

rootsudo 7y ago

The question now is: was hiring the cloud mining services cheaper than the reward of $72,000?

H8crilA 7y ago
Yes, you should try to read the article.

jb775 7y ago

1 for 1 so far on my 2020 decade predictions https://news.ycombinator.com/item?id=21943830 https://news.ycombinator.com/item?id=21943830

Traster 7y ago
Sorry, but this doesn't seem related to quantum - I don't think you get credit yet.
- jb775 7y ago
  I'm aware, I was being somewhat facetious since the topic of my #1 prediction occurred so soon into the decade. Your response sounds like a pouty little kid.

H8crilA 7y ago

And all of that costed just about $1.2k, what a joke currency.

granaldo 7y ago

How disconnect the market is from facts. Price of Bitcoin Gold is not even affected by this news at all https://www.coingecko.com/en/coins/bitcoin-gold https://www.coingecko.com/en/coins/bitcoin-gold The market may not even understand what 51% is about

runeks 7y ago
Or maybe all buy orders have disappeared. Looking at the last exchange price does not measure the value of a cryptocurrency, you need to look inside order books to see if anyone is even interested in buying your cryptocurrency. It’s not relevant to the value of your cryptocurrency that someone was once willing to buy it.

melissa018 7y ago

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