11 ms·

You don't need a DoS attack under the assumptions of this project. It's already assumed that you control ~80% of hash rate, so you execute a 51% attack that ma

You don't need a DoS attack under the assumptions of this project. It's already assumed that you control ~80% of hash rate, so you execute a 51% attack that mass double-spends coins and destroy all confidence in the integrity of the currency. Poof, nobody uses it. Note that China already controls ~65% of Bitcoin hash rate, so if they wanted to execute this right now, they probably could. That they haven't is one reason I'm bullish on cryptocurrency, and specifically Ethereum and Stellar, and it's entirely separate from why many other Bitcoin bulls are bullish on cryptocurrency. You don't need proof-of-work to secure a blockchain. You only need game theory: as long as each participant has more to gain from allowing Bitcoin's continued existence than destroying it (and they can't subvert or destroy it in a way that will be invisible to other market participants), it will continue to exist. China gains no benefit from destroying Bitcoin; they can just continue to let it exist and tax all the Bitcoin miners in China, generating revenue for themselves and their citizens and continuing to be a thorn in the side of dollar hegemony. This also implies that proof-of-stake (if done right) is just as good as proof-of-work, which'll solve the energy issues associated with Bitcoin. And it means that cryptocurrency adoption, if it happens, isn't going to be because it's particularly good: rather, it'll be because the U.S. has destroyed the dollar. There's value in cryptocurrency simply in it being an alternative that's readily available, so that civilization doesn't stop if the U.S. does end up miscalculating and hyperinflating the dollar.

AffableSpatula 6y ago
I'm not so sure. If you don't need proof of work to secure a blockchain, then why is the free market of Bitcoin consensus continuing to expend huge amounts of capital to stick with it as its sybil resistance mechanism? If it wasn't considered a value destroying move, the transition away from PoW would've happened already no?
- nostrademons 6y ago
  It has, in new cryptocurrencies. Virtually all cryptocurrencies launched since 2017 are proof-of-stake: Cardano, EOS, Stellar, Polkadot, Tezos, TRON. Ethereum is in the process of a very expensive and painful transition from proof-of-work to proof-of-stake. The reason you haven't seen this in the global cryptocurrency industry is because of network effects and adoption curves. Most programmers would probably agree that C++ is archaic and that the software industry has moved on to newer languages like Rust, Go, Kotlin, ES6, etc. Why then do Microsoft, Amazon, Apple, Google, etc. all rely on large quantities of C++ code? Because they were founded in the last millennia, when C++ was basically the only alternative for what they were trying to do, and have deeply enmeshed ecosystems and value chains that are all dependent on their existing C++ codebase. Throw it out and you throw out the $5T+ in value they've built. They couldn't have built that up without the 20 year head start they have, but if you're founding a tech company now, you're pretty dumb to use C++. Similarly, Bitcoin has built a whole ecosystem of miners, speculators, traders, exchanges, payment systems, wallets, etc. Throw proof-of-work out and you throw all that out, and along with it your advantage over Ethereum, Cardano, Stellar, etc.
  - hertzrat 6y ago
    > if you're founding a tech company now, you're pretty dumb to use C++ All us unreal engine using indie developers must be pretty dumb then. It’s true that programming in c# in unity is easier, but the end result of the c++ is a prettier game with more things happening at once at a higher frame rate. More grass, more characters, more animations, more AI nuance, more physics interactions, lower system requirements during a gpu shortage, etc
    - keskadale 6y ago
      try rust.
  - hanniabu 6y ago
    > and along with it your advantage over [PoS chains] You're assuming that PoW is better than PoS.
- DSMan195276 6y ago
  > If it wasn't considered a value destroying move, the transition away from PoW would've happened already no? I think there's a conflict of interest issue here that would prevent such a move even if it would be worth it - the miners clearly have an incentive to keep the current PoW mechanism, as without it they're left holding a bunch of expensive useless tech. And without the miners willing to go along with a move from PoW to PoS, at best you're going to get a split between the PoW and PoS chains rather than a clean shift from one to the other and just create a mess, which isn't ideal for anyone.
  - AffableSpatula 6y ago
    The attack scenario is an adversarial nation state who is not motivated economically and is intent on sabotage of the network.
    - DSMan195276 6y ago
      I don't understand what you're getting at, I was pointing out why Bitcoin hasn't moved to PoS even if it may actually be better.
      - AffableSpatula 6y ago
        You're right, I totally misread what you said. I think the answer to what you actually said is; miners don't control consensus on the network - it's not up to them, it's up to fullnodes/users who can change the ruleset whenever they want.
        DSMan195276 6y ago
        You're good :) And I agree to a point, but miners are the ones that effectively run the network, and there aren't actually all that "many" of them. Without the existing miners willing to contribute the existing network would fall apart. PoS is an interesting situation because it technically makes the miners unnecessary, but obviously the miners are going to say "no" and just keep going with the existing Bitcoin. It would just create another Bitcoin Cash situation effectively, which is a lot less appealing than if everybody switched to PoS and left nobody using the old version.
nugget 6y ago
Given China’s political structure, wouldn’t it just take one participant (President Xi) to wake up and decide “party over” if it became politically favorable to do so?
WJW 6y ago
> China gains no benefit from destroying Bitcoin; Citation needed on this one I'm afraid. If nothing else, a currency that the Party cannot control would be A Problem. China did not have much economic benefit in halting the ANT IPO, yet it did not go through all the same. There _might_ be a benefit in allowing bitcoin to continue to exist of course, if they think it advances their cause more than it hurts it. But as soon as that calculus changes, it seems quite likely that the big mining corps (with as you say at the moment of speaking about 65% of total hash rate) will receive some "friendly invitations" (from unfriendly people with guns) to stop their business operations.
- tshaddox 6y ago
  Why haven’t they destroyed it then?
  - WJW 6y ago
    In an elegant tautological argument: because at the moment it does not advance their causes to do so (yet).
  - PragmaticPulp 6y ago
    Frankly, because it’s not as much of a threat as the popular narrative suggests. They may actually benefit from being able to use cryptocurrency for their own ends, either by using it directly or using the public ledger nature combined with their surveillance powers to get insight into transactions. Regardless, the attacks described here require large concentrations of mining power. In theory, the best way to attack it would be to wait for (or even encourage/subsidize) your country to become the geographical leader in mining operations. Or even better: Wait for companies in competing countries to start holding BTC on their balance sheets and consumers to put their investments in BTC. Now you have a kill switch for part of the balance sheets of competing countries. I personally doubt this is happening, but I’m sure it’s being considered as an attack scenario.
    - bontaq 6y ago
      If anything, a government might even like a public ledger of all transactions. Sure, you can sell in person, and then it's about as secretive as cash.
pvarangot 6y ago
> Note that China already controls ~65% of Bitcoin hash rate, so if they wanted to execute this right now, they probably could. When you say "China" do you mean like an actor that can make coordinated decisions? Or just a geographic region? I'm asking out of curiosity because yeah there's a lot of miners in China across many geographic regions but I never saw any evidence that they even talking to each other, even less coordinated enough to agree on making a decision as drastic at attacking the Bitcoin blockchain.
- flatline 6y ago
  I think the concern is that the authoritarian Chinese government can exercise an awful lot of influence when they are inclined. For a supposedly decentralized system it's an awfully big risk.
- nine_k 6y ago
  The question is whether CCP has sufficient control over them. If it does not yet, it might consider working on that. OTOH I like the game-theoretic argument: they don't need to.
  - Fnoord 6y ago
    A better question to ask is: 'is the effort worth the gain?'
    - hinkley 6y ago
      Is the theater of starting the process worth the concessions I can win? It's not bluffing if you're willing to do it. But it's a lot cheaper if you don't have to follow through. China is scary because of the big risks they're willing to take. Like giant earthquakes or drowning Shanghai if their hydro power system has the failure that western civil engineers have predicted.
- generalizations 6y ago
  I'd make a wild guess that when parent is talking about 'control', they mean that if a miner is located within China, the Chinese government has the ability to put a gun to that miners head and tell them what to do.
PragmaticPulp 6y ago
> rather, it'll be because the U.S. has destroyed the dollar. There's value in cryptocurrency simply in it being an alternative that's readily available, so that civilization doesn't stop if the U.S. does end up miscalculating and hyperinflating the dollar. Even before Bitcoin, we had plenty of other alternative currencies that could have replaced the dollar. I’ve been reading headlines speculating about the dollar being replaced by other currencies as long as I can remember, before Bitcoin existed. To your point: If Bitcoin somehow did become an alternative world currency and USD was out of the running, wouldn’t that create great incentive for China to crash Bitcoin prices and drive everyone to use their national currency? I’m not happy with the current rate of inflation, but I think it’s also clear that true hyperinflationary scenarios aren’t likely in modern countries. As much as we like to criticize governments (often rightfully so), it takes orders of magnitude more incompetence and malice for a government to enter hyperinflation. It’s not something that is stumbled upon by accident.
- fny 6y ago
  US monetary dominance is up for grabs. This doesn't mean the US is necessarily supplanted as the world reserve currency, but it does mean lots of trade may dedollarize to some extent. My bet is there will be two major currency zones. Dollar/Euro in the West + Middle East + India, Renmimbi in the East + Australia + Africa. Given the explosion of debt to GDP in the west vs the east, I see no way the Renmimbi will not continue to appreciate against the dollar, and I fully expect Chinese monetary dominance to increase with the government's continued annexation of Hong Kong. BTC will probably dominate in countries were currency value is routinely destroyed (developing nations, Russia, the US and Europe to some extent) but as only as a back channel currency: I doubt any major commodity market or trade is ever going to be priced in BTC.
  - kmonsen 6y ago
    This is just silly, US military dominance is not anywhere close to up for grabs. They US might not have total dominance anywhere on earth anymore due to asymmetric weapons, but in a big fight the US is far and away the biggest dog still. It is not that it is not close, it is not even close to being close.
gge 6y ago
> Stellar kek
- dang 6y ago
  Could you please stop posting unsubstantive comments to Hacker News? We ban that sort of account.
Laforet 6y ago
How would a hyperinflation on the US dollar cause civilization to stop? In any case, crypto trading since 2017 has been nothing but people buying and selling imaginary ticker symbols on unregulated exchanges. For example, XVG and ETC has been subject to successful 51% attacks more than once and every time the price was hardly affected. And each time the "solution" to deep chain reorg involved the exchanges freezing all trading while developers rushed to add a hardcoded checkpoint. Once the "correct" version of history has been manually restored, everybody sing kumbaya and goes back to paying real cash for monopoly money. Crypto need no proof of anything (PoS is still vaporware - debate me if you want), other than a shared delusion of value headed by the bucket shops.
- swinglock 6y ago
  > PoS is still vaporware Why is that? Aren't Cardano and Polkadot PoS as they claim or doesn't it work?
  - Laforet 6y ago
    No PoS algorithm has yet managed to solve the Nothing-at-stake problem, nor are they any more resistant to the abovementioned kind of hostile takeover by the nation state player compared to PoW. I can't speak for every PoS coin out there but Cardano/Ouroborous explicitly assumes partial synchrony which is arguably never a good idea for a supposedly permissionless blockchain.
    - StavrosK 6y ago
      So PoS is vaporware because it hasn't solved a problem where the miners can act against their economic best interests and mine a fork? How does "there's a theoretical issue, and also it shares a problem with PoW" follow from "PoS is vaporware"?
      - gruez 6y ago
        > So PoS is vaporware because it hasn't solved a problem where the miners can act against their economic best interests and mine a fork? Not exactly. The point of "nothing as stake" attack is that you can pull off the attack while having... "nothing a stake".
afavour 6y ago
> China gains no benefit from destroying Bitcoin Right now they don't, no. But to my mind Bitcoin being subject to the whims of a major world power is a big knock against it, given that it aims to be a currency alternative. I don't want such an alternative to subject to any kind of geopolitical mood.
- core-questions 6y ago
  Yes. Much like mutually-assured-destruction with WMDs, we need to try to keep China to <50% of the mining pool, otherwise they can do as they wish with it. Maybe the US government doesn't mind that? Maybe they hope it will die, and send everyone flocking back to the dollar?
- fanciestManimal 6y ago
  Yea I can't see a power like China controlling bitcoin to be a good thing. I also can't see myself maintaining a substantial fraction of my wealth in a unit of value subject to the whim of a totalitarian government. It's not inconceivable (to me at least) that leaders could decide it's personally beneficial to them (or politically beneficial) to damage Bitcoin, even if it cost a ton of their tax payers money.
  - Udik 6y ago
    No power controlling Bitcoin is a good thing (at least for Bitcoin). That's true for China, who could force its miners to do what it wants, as it is for the US, which could make it arbitrarily hard to transact or hold BTC (and which also has the habit if imposing sanctions on other states' entities).
thatfrenchguy 6y ago
> China gains no benefit from destroying Bitcoin; they can just continue to let it exist and tax all the Bitcoin miners in China, generating revenue for themselves and their citizens and continuing to be a thorn in the side of dollar hegemony CO2 emissions is probably why I'd do it if I were the Chinese government frankly.
- throwaway1777 6y ago
  Environmental virtue signaling compared to other co2 emission sources in China.
hertzrat 6y ago
Will Bitcoin even be that decentralized in 50 years? The miners control the network, and most mining is done by big companies now and their data centres. If it’s like other companies, won’t they gradually acquire one another until there is only 1-2 companies controlling almost the entire future crypto economy? The scale of the computing power we are talking about is not something that individuals can compete with
- mrits 6y ago
  I've posted here before about it. I'm of the opinion that it currently is not decentralized. There is such a shortage of hardware that can be competitive right now and there are only a few organizations that can get their hands on them. I think this problem is just going to get worse when the manufactures start to realize it doesn't make sense to sell any of their miners at all.
  - swader999 6y ago
    Agree, the electricity for the mining is even more centralised. That really is the point of control on this whole thing.
    - hertzrat 6y ago
      Electricity is a big deal even without crypto. Look at Texas right now - people have more to worry about than their mining rigs being offline
ardy42 6y ago
> China gains no benefit from destroying Bitcoin; they can just continue to let it exist and tax all the Bitcoin miners in China, generating revenue for themselves and their citizens and continuing to be a thorn in the side of dollar hegemony. That's making a lot of assumptions which I don't think there are good grounds to assume. For instance, that Bitcoin tax revenue is something the Chinese government cares enough about for it to affect its decision-making, or that Bitcoin is a "thorn in the side of dollar hegemony." I think the reality is that Bitcoin (and cryptocurrency in general) is a niche thing that isn't nearly as important as its fans like to think it is, so there's little for a state-actor to gain by making the effort to disrupt it.
goldcd 6y ago
I think I agree with you and think there's a parallel to other conventional currencies. Controlling the hash is similar to controlling a central bank - you've got the power to trash your currency, but that's coupled with you probably having the most to lose if you do so. You could maybe do something stupid short-term - Say you own a controlling amount of hash, but a fraction of the currency. You could seize the currency, but by doing do you devalue it all. Who in their right mind would buy a seized bitcoin from you for any price, knowing you could seize it right back? Currency equivalent would be the Fed suddenly stating a dollar was worth half-as-much as it was before (compared to some external thing) and compensating all US citizens by doubling their dollar earnings. As a dollar earner/spender you'd notionally be unaffected. Dollar debt the US owed would be halved - Yay! However the effect on non-US dollar holders would be cataclysmic - "You made half my money vanish, you might do it again, I don't want to ever hold US dollars again" and bricks of your currency is being used by children worldwide to build forts. The entire selling point of BTC is that it's outside of conventional government control. If proved otherwise, it's without value. More realistically, "Chinese Miners" aren't the government. They're miners, who happen to be in China, due to cheap power costs. At the first whiff of any meddling, their ASICs going to be on a plane and plugged into the Hoover Damn or Iceland's geothermals.
- ntr-- 6y ago
  > More realistically, "Chinese Miners" aren't the government. I think that's largely the point, other comments are appealing that somehow the Chinese govt has a lot to lose by seizing control of bitcoin, but in reality they probably just have no reason to yet, it beggars belief that an authoritarian government would allow private citizens to control an important currency on their own soil. My own take is that they are letting it run because of the shadow of doubt it is casting on the USD. > ASICs going to be on a plane and plugged into the Hoover Damn or Iceland's geothermals A little simplistic to think non-negligible percentages of the hash pool would turn themselves off, relocate internationally, completely disrupt the difficulty rate, put themselves at a massive disadvantage and subject themselves to an unknown foreign government who might be completely hostile toward them. More pertinently the CCP might "meddle" with their ability to fly out of the country as they have done with countless dissidents already.
pk_kinetic 6y ago
I wonder if at some point Bitcoin might become important enough that nation states will work together to ensure that no one state has more than a 51% hashrate as a matter of national security.
- danlugo92 6y ago
  This will happen
  - randomopining 6y ago
    Sarcastic? Basically btc might get too big to fail... then they may have international laws in place?
jpollock 6y ago
I thought that while there's data now, the sample is _extremely_ skewed to Chinese hashers: https://news.bitcoin.com/65-of-global-bitcoin-hashrate-concentrated-in-china/ https://news.bitcoin.com/65-of-global-bitcoin-hashrate-conce...
moralsupply 6y ago
> Note that China already controls ~65% of Bitcoin hash rate, so if they wanted to execute this right now, they probably could. That's not correct. Most pools are in China, but the majority of the hash rate is generated in the USA.
- ayngg 6y ago
  Do you have a source? I have been keeping an eye out for stats regarding this but everything is mostly just derived from the Cambridge data.
CMCDragonkai 6y ago
You vastly overestimate the command and control capability of China. China and Chinese people are not a Borg.
- randomopining 6y ago
  How? Their whole apparatus has been built for that
  - Wintereise 6y ago
    Keeping your head down and actively agreeing with governmental policies are two different things. As things are now, people from authoritarian countries are really, really good at the former.
beaner 6y ago
> so you execute a 51% attack that mass double-spends coins 51% attacks don't double-spend coins. It just means you get to control which blocks are accepted, it doesn't mean you can violate the rules.
- curyous 6y ago
  Double-spending doesn't change the rules, it changes where coins get sent, so you can rip-off the original recipient.
  - beaner 6y ago
    "double spending" as a technical term means double spending within the blockchain.
bouncycastle 6y ago
Yeah, correct. Even if you do control 51%, it would be a big long term capital and operational expense to do so, so you'd probably want to play nice rather than destroy what you've built. Besides, even if you attack it, a new network will just spring up again, possibly with a different mining algorithm, making your old mining gear obsolete. Also, in PoS, another last resort "nuclear option" defence strategy would be to slash the nodes that attack the network through a hard fork. It's a "nuclear option" because in theory it's unlikely to happen, only used a deterrent. "Slash" here means to confiscate and burn their staking deposit on the new network. (The old one will continue to operate where the arrackers reside, thus a "fork")
keskadale 6y ago
> You don't need proof-of-work to secure a blockchain. You only need game theory Some people just want to watch the world burn. - Alfred from The Dark Knight
jiocrag 6y ago
How do you account for “let the world burn”-type actors in this scenario though? It seems this pulls at the key misunderstanding around crypto and blockchain in general — it can’t sanitize the endpoints. If any human party has the power to defraud, manipulate, or commit any other nefarious act (as you imply China does), the system is vulnerable. This is why proof of work provides some level of resilience—you have to be nefarious AND have access to massive compute resources to do harm. China has the compute resources, but not the incentive. A proof of stake power broker may have the incentive and not need the compute.
zapdrive 6y ago
>> Stellar. Lol.
loceng 6y ago
"You only need game theory: as long as each participant has more to gain from allowing Bitcoin's continued existence than destroying it (and they can't subvert or destroy it in a way that will be invisible to other market participants), it will continue to exist." The CCP doesn't allow Chinese citizens to own Bitcoin as far as I know - however they allow mining because it's generating revenue. And of course, Bitcoin's continued existence by the "army of HODLers" is a non-brainer when you join an MLM - everyone who has adopted it will push for its price to go up (or return to the prior buy price) so they can realize a profit - until the latest adopters are left holding the bag.
conqueso 6y ago
> That they haven't is one reason I'm bullish on cryptocurrency, and specifically Ethereum and Stellar I'm curious why you are bullish on those 2 specifically?

AffableSpatula 6y ago

I'm not so sure. If you don't need proof of work to secure a blockchain, then why is the free market of Bitcoin consensus continuing to expend huge amounts of capital to stick with it as its sybil resistance mechanism? If it wasn't considered a value destroying move, the transition away from PoW would've happened already no?

nostrademons 6y ago
It has, in new cryptocurrencies. Virtually all cryptocurrencies launched since 2017 are proof-of-stake: Cardano, EOS, Stellar, Polkadot, Tezos, TRON. Ethereum is in the process of a very expensive and painful transition from proof-of-work to proof-of-stake. The reason you haven't seen this in the global cryptocurrency industry is because of network effects and adoption curves. Most programmers would probably agree that C++ is archaic and that the software industry has moved on to newer languages like Rust, Go, Kotlin, ES6, etc. Why then do Microsoft, Amazon, Apple, Google, etc. all rely on large quantities of C++ code? Because they were founded in the last millennia, when C++ was basically the only alternative for what they were trying to do, and have deeply enmeshed ecosystems and value chains that are all dependent on their existing C++ codebase. Throw it out and you throw out the $5T+ in value they've built. They couldn't have built that up without the 20 year head start they have, but if you're founding a tech company now, you're pretty dumb to use C++. Similarly, Bitcoin has built a whole ecosystem of miners, speculators, traders, exchanges, payment systems, wallets, etc. Throw proof-of-work out and you throw all that out, and along with it your advantage over Ethereum, Cardano, Stellar, etc.
- hertzrat 6y ago
  > if you're founding a tech company now, you're pretty dumb to use C++ All us unreal engine using indie developers must be pretty dumb then. It’s true that programming in c# in unity is easier, but the end result of the c++ is a prettier game with more things happening at once at a higher frame rate. More grass, more characters, more animations, more AI nuance, more physics interactions, lower system requirements during a gpu shortage, etc
  - keskadale 6y ago
    try rust.
- hanniabu 6y ago
  > and along with it your advantage over [PoS chains] You're assuming that PoW is better than PoS.
DSMan195276 6y ago
> If it wasn't considered a value destroying move, the transition away from PoW would've happened already no? I think there's a conflict of interest issue here that would prevent such a move even if it would be worth it - the miners clearly have an incentive to keep the current PoW mechanism, as without it they're left holding a bunch of expensive useless tech. And without the miners willing to go along with a move from PoW to PoS, at best you're going to get a split between the PoW and PoS chains rather than a clean shift from one to the other and just create a mess, which isn't ideal for anyone.
- AffableSpatula 6y ago
  The attack scenario is an adversarial nation state who is not motivated economically and is intent on sabotage of the network.
  - DSMan195276 6y ago
    I don't understand what you're getting at, I was pointing out why Bitcoin hasn't moved to PoS even if it may actually be better.
    - AffableSpatula 6y ago
      You're right, I totally misread what you said. I think the answer to what you actually said is; miners don't control consensus on the network - it's not up to them, it's up to fullnodes/users who can change the ruleset whenever they want.
      - DSMan195276 6y ago
        You're good :) And I agree to a point, but miners are the ones that effectively run the network, and there aren't actually all that "many" of them. Without the existing miners willing to contribute the existing network would fall apart. PoS is an interesting situation because it technically makes the miners unnecessary, but obviously the miners are going to say "no" and just keep going with the existing Bitcoin. It would just create another Bitcoin Cash situation effectively, which is a lot less appealing than if everybody switched to PoS and left nobody using the old version.

nugget 6y ago

Given China’s political structure, wouldn’t it just take one participant (President Xi) to wake up and decide “party over” if it became politically favorable to do so?

WJW 6y ago

> China gains no benefit from destroying Bitcoin; Citation needed on this one I'm afraid. If nothing else, a currency that the Party cannot control would be A Problem. China did not have much economic benefit in halting the ANT IPO, yet it did not go through all the same. There _might_ be a benefit in allowing bitcoin to continue to exist of course, if they think it advances their cause more than it hurts it. But as soon as that calculus changes, it seems quite likely that the big mining corps (with as you say at the moment of speaking about 65% of total hash rate) will receive some "friendly invitations" (from unfriendly people with guns) to stop their business operations.

tshaddox 6y ago
Why haven’t they destroyed it then?
- WJW 6y ago
  In an elegant tautological argument: because at the moment it does not advance their causes to do so (yet).
- PragmaticPulp 6y ago
  Frankly, because it’s not as much of a threat as the popular narrative suggests. They may actually benefit from being able to use cryptocurrency for their own ends, either by using it directly or using the public ledger nature combined with their surveillance powers to get insight into transactions. Regardless, the attacks described here require large concentrations of mining power. In theory, the best way to attack it would be to wait for (or even encourage/subsidize) your country to become the geographical leader in mining operations. Or even better: Wait for companies in competing countries to start holding BTC on their balance sheets and consumers to put their investments in BTC. Now you have a kill switch for part of the balance sheets of competing countries. I personally doubt this is happening, but I’m sure it’s being considered as an attack scenario.
  - bontaq 6y ago
    If anything, a government might even like a public ledger of all transactions. Sure, you can sell in person, and then it's about as secretive as cash.

pvarangot 6y ago

> Note that China already controls ~65% of Bitcoin hash rate, so if they wanted to execute this right now, they probably could. When you say "China" do you mean like an actor that can make coordinated decisions? Or just a geographic region? I'm asking out of curiosity because yeah there's a lot of miners in China across many geographic regions but I never saw any evidence that they even talking to each other, even less coordinated enough to agree on making a decision as drastic at attacking the Bitcoin blockchain.

flatline 6y ago
I think the concern is that the authoritarian Chinese government can exercise an awful lot of influence when they are inclined. For a supposedly decentralized system it's an awfully big risk.
nine_k 6y ago
The question is whether CCP has sufficient control over them. If it does not yet, it might consider working on that. OTOH I like the game-theoretic argument: they don't need to.
- Fnoord 6y ago
  A better question to ask is: 'is the effort worth the gain?'
  - hinkley 6y ago
    Is the theater of starting the process worth the concessions I can win? It's not bluffing if you're willing to do it. But it's a lot cheaper if you don't have to follow through. China is scary because of the big risks they're willing to take. Like giant earthquakes or drowning Shanghai if their hydro power system has the failure that western civil engineers have predicted.
generalizations 6y ago
I'd make a wild guess that when parent is talking about 'control', they mean that if a miner is located within China, the Chinese government has the ability to put a gun to that miners head and tell them what to do.

PragmaticPulp 6y ago

> rather, it'll be because the U.S. has destroyed the dollar. There's value in cryptocurrency simply in it being an alternative that's readily available, so that civilization doesn't stop if the U.S. does end up miscalculating and hyperinflating the dollar. Even before Bitcoin, we had plenty of other alternative currencies that could have replaced the dollar. I’ve been reading headlines speculating about the dollar being replaced by other currencies as long as I can remember, before Bitcoin existed. To your point: If Bitcoin somehow did become an alternative world currency and USD was out of the running, wouldn’t that create great incentive for China to crash Bitcoin prices and drive everyone to use their national currency? I’m not happy with the current rate of inflation, but I think it’s also clear that true hyperinflationary scenarios aren’t likely in modern countries. As much as we like to criticize governments (often rightfully so), it takes orders of magnitude more incompetence and malice for a government to enter hyperinflation. It’s not something that is stumbled upon by accident.

fny 6y ago
US monetary dominance is up for grabs. This doesn't mean the US is necessarily supplanted as the world reserve currency, but it does mean lots of trade may dedollarize to some extent. My bet is there will be two major currency zones. Dollar/Euro in the West + Middle East + India, Renmimbi in the East + Australia + Africa. Given the explosion of debt to GDP in the west vs the east, I see no way the Renmimbi will not continue to appreciate against the dollar, and I fully expect Chinese monetary dominance to increase with the government's continued annexation of Hong Kong. BTC will probably dominate in countries were currency value is routinely destroyed (developing nations, Russia, the US and Europe to some extent) but as only as a back channel currency: I doubt any major commodity market or trade is ever going to be priced in BTC.
- kmonsen 6y ago
  This is just silly, US military dominance is not anywhere close to up for grabs. They US might not have total dominance anywhere on earth anymore due to asymmetric weapons, but in a big fight the US is far and away the biggest dog still. It is not that it is not close, it is not even close to being close.

gge 6y ago

> Stellar kek

dang 6y ago
Could you please stop posting unsubstantive comments to Hacker News? We ban that sort of account.

Laforet 6y ago

How would a hyperinflation on the US dollar cause civilization to stop? In any case, crypto trading since 2017 has been nothing but people buying and selling imaginary ticker symbols on unregulated exchanges. For example, XVG and ETC has been subject to successful 51% attacks more than once and every time the price was hardly affected. And each time the "solution" to deep chain reorg involved the exchanges freezing all trading while developers rushed to add a hardcoded checkpoint. Once the "correct" version of history has been manually restored, everybody sing kumbaya and goes back to paying real cash for monopoly money. Crypto need no proof of anything (PoS is still vaporware - debate me if you want), other than a shared delusion of value headed by the bucket shops.

swinglock 6y ago
> PoS is still vaporware Why is that? Aren't Cardano and Polkadot PoS as they claim or doesn't it work?
- Laforet 6y ago
  No PoS algorithm has yet managed to solve the Nothing-at-stake problem, nor are they any more resistant to the abovementioned kind of hostile takeover by the nation state player compared to PoW. I can't speak for every PoS coin out there but Cardano/Ouroborous explicitly assumes partial synchrony which is arguably never a good idea for a supposedly permissionless blockchain.
  - StavrosK 6y ago
    So PoS is vaporware because it hasn't solved a problem where the miners can act against their economic best interests and mine a fork? How does "there's a theoretical issue, and also it shares a problem with PoW" follow from "PoS is vaporware"?
    - gruez 6y ago
      > So PoS is vaporware because it hasn't solved a problem where the miners can act against their economic best interests and mine a fork? Not exactly. The point of "nothing as stake" attack is that you can pull off the attack while having... "nothing a stake".

afavour 6y ago

> China gains no benefit from destroying Bitcoin Right now they don't, no. But to my mind Bitcoin being subject to the whims of a major world power is a big knock against it, given that it aims to be a currency alternative. I don't want such an alternative to subject to any kind of geopolitical mood.

core-questions 6y ago
Yes. Much like mutually-assured-destruction with WMDs, we need to try to keep China to <50% of the mining pool, otherwise they can do as they wish with it. Maybe the US government doesn't mind that? Maybe they hope it will die, and send everyone flocking back to the dollar?
fanciestManimal 6y ago
Yea I can't see a power like China controlling bitcoin to be a good thing. I also can't see myself maintaining a substantial fraction of my wealth in a unit of value subject to the whim of a totalitarian government. It's not inconceivable (to me at least) that leaders could decide it's personally beneficial to them (or politically beneficial) to damage Bitcoin, even if it cost a ton of their tax payers money.
- Udik 6y ago
  No power controlling Bitcoin is a good thing (at least for Bitcoin). That's true for China, who could force its miners to do what it wants, as it is for the US, which could make it arbitrarily hard to transact or hold BTC (and which also has the habit if imposing sanctions on other states' entities).

thatfrenchguy 6y ago

throwaway1777 6y ago
Environmental virtue signaling compared to other co2 emission sources in China.

hertzrat 6y ago

Will Bitcoin even be that decentralized in 50 years? The miners control the network, and most mining is done by big companies now and their data centres. If it’s like other companies, won’t they gradually acquire one another until there is only 1-2 companies controlling almost the entire future crypto economy? The scale of the computing power we are talking about is not something that individuals can compete with

mrits 6y ago
I've posted here before about it. I'm of the opinion that it currently is not decentralized. There is such a shortage of hardware that can be competitive right now and there are only a few organizations that can get their hands on them. I think this problem is just going to get worse when the manufactures start to realize it doesn't make sense to sell any of their miners at all.
- swader999 6y ago
  Agree, the electricity for the mining is even more centralised. That really is the point of control on this whole thing.
  - hertzrat 6y ago
    Electricity is a big deal even without crypto. Look at Texas right now - people have more to worry about than their mining rigs being offline

ardy42 6y ago

> China gains no benefit from destroying Bitcoin; they can just continue to let it exist and tax all the Bitcoin miners in China, generating revenue for themselves and their citizens and continuing to be a thorn in the side of dollar hegemony. That's making a lot of assumptions which I don't think there are good grounds to assume. For instance, that Bitcoin tax revenue is something the Chinese government cares enough about for it to affect its decision-making, or that Bitcoin is a "thorn in the side of dollar hegemony." I think the reality is that Bitcoin (and cryptocurrency in general) is a niche thing that isn't nearly as important as its fans like to think it is, so there's little for a state-actor to gain by making the effort to disrupt it.

goldcd 6y ago

I think I agree with you and think there's a parallel to other conventional currencies. Controlling the hash is similar to controlling a central bank - you've got the power to trash your currency, but that's coupled with you probably having the most to lose if you do so. You could maybe do something stupid short-term - Say you own a controlling amount of hash, but a fraction of the currency. You could seize the currency, but by doing do you devalue it all. Who in their right mind would buy a seized bitcoin from you for any price, knowing you could seize it right back? Currency equivalent would be the Fed suddenly stating a dollar was worth half-as-much as it was before (compared to some external thing) and compensating all US citizens by doubling their dollar earnings. As a dollar earner/spender you'd notionally be unaffected. Dollar debt the US owed would be halved - Yay! However the effect on non-US dollar holders would be cataclysmic - "You made half my money vanish, you might do it again, I don't want to ever hold US dollars again" and bricks of your currency is being used by children worldwide to build forts. The entire selling point of BTC is that it's outside of conventional government control. If proved otherwise, it's without value. More realistically, "Chinese Miners" aren't the government. They're miners, who happen to be in China, due to cheap power costs. At the first whiff of any meddling, their ASICs going to be on a plane and plugged into the Hoover Damn or Iceland's geothermals.

ntr-- 6y ago
> More realistically, "Chinese Miners" aren't the government. I think that's largely the point, other comments are appealing that somehow the Chinese govt has a lot to lose by seizing control of bitcoin, but in reality they probably just have no reason to yet, it beggars belief that an authoritarian government would allow private citizens to control an important currency on their own soil. My own take is that they are letting it run because of the shadow of doubt it is casting on the USD. > ASICs going to be on a plane and plugged into the Hoover Damn or Iceland's geothermals A little simplistic to think non-negligible percentages of the hash pool would turn themselves off, relocate internationally, completely disrupt the difficulty rate, put themselves at a massive disadvantage and subject themselves to an unknown foreign government who might be completely hostile toward them. More pertinently the CCP might "meddle" with their ability to fly out of the country as they have done with countless dissidents already.

pk_kinetic 6y ago

I wonder if at some point Bitcoin might become important enough that nation states will work together to ensure that no one state has more than a 51% hashrate as a matter of national security.

danlugo92 6y ago
This will happen
- randomopining 6y ago
  Sarcastic? Basically btc might get too big to fail... then they may have international laws in place?

jpollock 6y ago

I thought that while there's data now, the sample is _extremely_ skewed to Chinese hashers: https://news.bitcoin.com/65-of-global-bitcoin-hashrate-concentrated-in-china/ https://news.bitcoin.com/65-of-global-bitcoin-hashrate-conce...

moralsupply 6y ago

> Note that China already controls ~65% of Bitcoin hash rate, so if they wanted to execute this right now, they probably could. That's not correct. Most pools are in China, but the majority of the hash rate is generated in the USA.

ayngg 6y ago
Do you have a source? I have been keeping an eye out for stats regarding this but everything is mostly just derived from the Cambridge data.

CMCDragonkai 6y ago

You vastly overestimate the command and control capability of China. China and Chinese people are not a Borg.

randomopining 6y ago
How? Their whole apparatus has been built for that
- Wintereise 6y ago
  Keeping your head down and actively agreeing with governmental policies are two different things. As things are now, people from authoritarian countries are really, really good at the former.

beaner 6y ago

> so you execute a 51% attack that mass double-spends coins 51% attacks don't double-spend coins. It just means you get to control which blocks are accepted, it doesn't mean you can violate the rules.

curyous 6y ago
Double-spending doesn't change the rules, it changes where coins get sent, so you can rip-off the original recipient.
- beaner 6y ago
  "double spending" as a technical term means double spending within the blockchain.

bouncycastle 6y ago

Yeah, correct. Even if you do control 51%, it would be a big long term capital and operational expense to do so, so you'd probably want to play nice rather than destroy what you've built. Besides, even if you attack it, a new network will just spring up again, possibly with a different mining algorithm, making your old mining gear obsolete. Also, in PoS, another last resort "nuclear option" defence strategy would be to slash the nodes that attack the network through a hard fork. It's a "nuclear option" because in theory it's unlikely to happen, only used a deterrent. "Slash" here means to confiscate and burn their staking deposit on the new network. (The old one will continue to operate where the arrackers reside, thus a "fork")

keskadale 6y ago

> You don't need proof-of-work to secure a blockchain. You only need game theory Some people just want to watch the world burn. - Alfred from The Dark Knight

jiocrag 6y ago

How do you account for “let the world burn”-type actors in this scenario though? It seems this pulls at the key misunderstanding around crypto and blockchain in general — it can’t sanitize the endpoints. If any human party has the power to defraud, manipulate, or commit any other nefarious act (as you imply China does), the system is vulnerable. This is why proof of work provides some level of resilience—you have to be nefarious AND have access to massive compute resources to do harm. China has the compute resources, but not the incentive. A proof of stake power broker may have the incentive and not need the compute.

zapdrive 6y ago

>> Stellar. Lol.

loceng 6y ago

"You only need game theory: as long as each participant has more to gain from allowing Bitcoin's continued existence than destroying it (and they can't subvert or destroy it in a way that will be invisible to other market participants), it will continue to exist." The CCP doesn't allow Chinese citizens to own Bitcoin as far as I know - however they allow mining because it's generating revenue. And of course, Bitcoin's continued existence by the "army of HODLers" is a non-brainer when you join an MLM - everyone who has adopted it will push for its price to go up (or return to the prior buy price) so they can realize a profit - until the latest adopters are left holding the bag.

conqueso 6y ago

> That they haven't is one reason I'm bullish on cryptocurrency, and specifically Ethereum and Stellar I'm curious why you are bullish on those 2 specifically?