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The "security" of btc cryptocurrency is proportional to how much energy it wastes; that's radically different than the banking system. The more billions it cos

The "security" of btc cryptocurrency is proportional to how much energy it wastes; that's radically different than the banking system. The more billions it costs to run bitcoin, the more it costs to 51% attack it. If you can outwaste energy, you can hijack the system. It would be useful it some state, eg., russia or china, would just cut off networks and forge bitcoin network traffic -- and hence bring the whole thing down. Or, do a 51% attack by controlling 51% of the hashing power. The whole thing is a joke, one only tolerated by states because it's supports joke levels of economic transactions. Were any % of an economy to run on this, states would just seal the network in their borders and end the whole charade.

snapcaster 3y ago
How would they seal the network in their borders? Why would that bring the whole thing down? Countries that shut down internet don't seem to bring that whole thing down in any sense
- lovich 3y ago
  https://xkcd.com/538/ https://xkcd.com/538/ Countries have this neat tool called violence that tends to override all security whenever humans are a linchpin
  - hk__2 3y ago
    > Countries have this neat tool called violence that tends to override all security whenever humans are a linchpin That doesn’t work with distributed systems. No single country is able to shut the whole Internet down, for example.
    - manquer 3y ago
      They don’t need to shutdown for everyone , they need to shutdown only for their country . Countries do this all the time , just yesterday we were talking about internet shutdown during elections and exams , then there are restricted countries like say North Korea.
    - ben_w 3y ago
      0) yes they do, in extremis half a dozen HAEMP would basically take out the whole internet (b) "seal the network in their borders" is much easier than that, lots of networks basically act like that already due to either voluntary compliance with local laws, or due to direct government interference with the networks iii. the miners aren't really all that distributed, they group together for the same reason everyone else groups together instead of being free-range anarchists [δ] all you need to do to shut down a currency within a country is arrest people using it, which is very easy and has a long history
    - lovich 3y ago
      The US is certainly capable of shutting down the internet with their control of some critical pieces of infrastructure like ICANN. They haven’t ever used it because levers like those are ones you only get to use once before other countries build an alternative, like when China shut down rare earth exports to japan years ago so countries like the US started up mines that were previously not worth it
  - deleted 3y ago
    [deleted]
- mjburgess 3y ago
  Cryptocurrencies are peer-to-peer systems. If you control the network they're on, you can do anything you like. Take the peer-to-peer traffic of the cryptocurrency network of any area, prevent it from getting outside that area (ie., just block it talking to IPs outside some range) -- then to that network, you can trivially control the total hashing power. So split any cryptocurrency network into small segements, then add your machine to that network with a false history, design the network to be small enough, and your machine will out-hash the rest, and so it's history will win. Rinse-and-repeat. It's trivial for any state to take down a cryptocurrency. There's nothing magic about it; it's an incredibly fragile system whose 'safety' relies on no one owning the network, and if that's the case, no one being able to russle-up huge amounts of electricity. In both cases, this is false for states. So any state, if it wishes, can really do anything it likes. The global bitcoin system is well within rearch of a hostile state 51%'ing it, even at the global level -- though the cost would be non-trivial. It would be trivial to do it in its own borders though. As any state, of course will, if you can ever go into a shop and buy somehting with it. At that point you're imperilling a state's ability to use monetary policy to manage its economy, and that's an existential security threat. So bye bye your monopoly money tokens.
  - whatshisface 3y ago
    That's an elaborate and wasteful way to achieve the same results as banning crypto.
  - wongarsu 3y ago
    You would be able to control the part of the network you cut off, but if anyone smuggles in as much as a microSD card with the outside blockchain state and syncs it to their client, every client in the segment would see this longer chain (since the outside has more hash power than you) and recognize it as legitimate, undoing all your fraudulent transactions (along with a lot of legitimate ones that never reached the outside network)
  - null0pointer 3y ago
    > So split any cryptocurrency network into small segements, then add your machine to that network with a false history, design the network to be small enough, and your machine will out-hash the rest, and so it's history will win. Rinse-and-repeat. You cannot forge history, even with 100% of the hash power. Firstly, each transaction is cryptographically signed with the keys of the sender address. Secondly, each full node within the segmented network will have the full history. The only thing you can do is publish different blocks to the segmented network than the blocks the outside network has. You cannot create arbitrary transactions. You can only censor others’ transactions within the segmented network. Since the mining difficulty will not adjust instantaneously your segmented network will fall behind the outside network in block height unless you control more hashing power than everyone else mining Bitcoin on either network combined. So as soon as anyone in your segmented network re-establishes connection with the outside network (and they will, they could receive a physical hard drive with the blockchain on it and rebroadcast to segmented nodes) all your work is for nothing. You might say “yeah well I’ll publish an entire fake history that is MUCH longer than the outside network with lower difficulty so I can stay ahead”. Well, actually you can’t, because if you wanted vastly more blocks between Bitcoins inception and the present then the difficulty will necessarily be much higher because that’s how difficulty gets set, by how quickly blocks are produced. You would have to change the difficulty adjustment algorithm, creating a fork between your own malicious node(s) and the other nodes in your segmented network. Oh and by the way, you _still_ can’t create arbitrary transactions. > The global bitcoin system is well within rearch of a hostile state 51%'ing it I’ll believe it when I see it. They honestly have a better chance outlawing it and imprisoning anyone who’s ever used it.
sk55 3y ago
Not really. Proof of stake offers a very energy efficient way to secure transactions. That is what Ethereum runs on.
- Scoundreller 3y ago
  I think the most efficient is a stable coin where you skip the step of actually backing it.
PretzelPirate 3y ago
> The "security" of any cryptocurrency is proportional to how much energy it wastes This only applies to Proof of Work blockchain.
- tibbon 3y ago
  Which is what Bitcoin uses, and it is one of the largest and most commonly used cryptocurrencies out there.
  - Scoundreller 3y ago
    is it the most transacted? And it's share of transactions has gone down (from being the only choice to lots of choices) Largest market cap, yes, but also lots of probably lost coin. One source shows Tether having the most volume, and it's very energy efficient to make coin out of thin air.
  - pcthrowaway 3y ago
    Yes, but bitcoin is something of an outlier there.. I realize the "top 100" cryptocurrencies by market cap isn't necessarily very meaningful, but like 90% of those are proof of stake, including ethereum, which is the second most valuable cryptocurrency, and actually more widely used than bitcoin in terms of transactions or number of unique wallets.
digging 3y ago
I'm not an expert here but my understanding is that even if a so-called 51% attack were to happen, it would only be meaningful as long as it could be sustained. The simplest case is a single tainted block, after which other miners could roll back by consensus. If a nation wanted to "permanently" take over >50% of the network, I believe the Bitcoin community would see that coming, and it would be a colossal investment of energy for a not-very-good chance of taking over. Bitcoin.
- mjburgess 3y ago
  only of the global network. states own the network infra in their borders, so they can partition it to any size they wish.
- treyd 3y ago
  > The simplest case is a single tainted block, after which other miners could roll back by consensus. Invalid blocks are rejected trivially by any node as soon as it sees them. You can't "force" an invalid block to be accepted by throwing hashrate at it and miners don't need to do anything to make an invalid block be recognized as such. The issue is on malicious actors trying to rewrite/replace recent blocks (to double spend, usually) which was the core innovation, but that also includes trying to censor txs or generally DoS the network by refusing to allow txs to be accepted.
WinstonSmith84 3y ago
> The "security" of any cryptocurrency is proportional to how much energy it wastes Oops, nope sorry. Most don't use PoW..
Throw73747 3y ago
> 51% attack it. If you can outwaste energy, you can hijack the system Out hashing does not give you any extra powers. Maybe you will be able to rollback a few minutes of transactions, that is all.
- mjburgess 3y ago
  if you split the network, you can add your own machines, that can rewrite the history arbitrarily from the future of that split. As for "a few minutes", it depends on which one we're talking about. BTC, yes -- but disrupting the global BTC network requires only a few minutes of time. Just dump everything into unusable addresses, and watch the reaction.
  - rlpb 3y ago
    > can rewrite the history arbitrarily No, you cannot do that. Transactions would still need to be signed by the corresponding owners. All you could do is reorder (and thus invalidate) some transactions, drop some transactions, or add some that weren't originally included. > Just dump everything into unusable addresses... Nope; that's not possible. You wouldn't have the signatures to do that even with 51% hashing power.
    - mjburgess 3y ago
      You're right about the dumping; I was thinking more about the case where you controlled the protocol on the machines of a partitioned network (eg., so you release a new version of btc which uses exploitable crytography, etc.). In the case of a mere 51% at scale, hijinks are still quite possible from replays, reorderings, etc. I was more preoccupied by the case where the state's acting in its own borders with control over the network, major miners, most machines on the network -- at this point basically no gaurentees remain
      - rlpb 3y ago
        > the case where you controlled the protocol on the machines of a partitioned network (eg., so you release a new version of btc which uses exploitable crytography Such a change would be treated as a "monopoly money" fork by those wanting to transact, and ignored. "No I don't want your fake money; send me real BTC or GTFO". This is why miners cannot arbitrarily change the protocol in their favour even today.
wongarsu 3y ago
> The "security" of btc cryptocurrency is proportional to how much energy it wastes It's proportional to the amount of money it "burns", in the form of capital costs (miners) and electricity costs (for those miners). If electricity prices would rise tenfold globally, electricity use from crypto miners would drop by about the same factor.
FabHK 3y ago
Yes. PoW blockchains: energy efficient, secure, supporting a highly valuable crypto currency - pick any two.

snapcaster 3y ago

How would they seal the network in their borders? Why would that bring the whole thing down? Countries that shut down internet don't seem to bring that whole thing down in any sense

lovich 3y ago
https://xkcd.com/538/ https://xkcd.com/538/ Countries have this neat tool called violence that tends to override all security whenever humans are a linchpin
- hk__2 3y ago
  > Countries have this neat tool called violence that tends to override all security whenever humans are a linchpin That doesn’t work with distributed systems. No single country is able to shut the whole Internet down, for example.
  - manquer 3y ago
    They don’t need to shutdown for everyone , they need to shutdown only for their country . Countries do this all the time , just yesterday we were talking about internet shutdown during elections and exams , then there are restricted countries like say North Korea.
  - ben_w 3y ago
    0) yes they do, in extremis half a dozen HAEMP would basically take out the whole internet (b) "seal the network in their borders" is much easier than that, lots of networks basically act like that already due to either voluntary compliance with local laws, or due to direct government interference with the networks iii. the miners aren't really all that distributed, they group together for the same reason everyone else groups together instead of being free-range anarchists [δ] all you need to do to shut down a currency within a country is arrest people using it, which is very easy and has a long history
  - lovich 3y ago
    The US is certainly capable of shutting down the internet with their control of some critical pieces of infrastructure like ICANN. They haven’t ever used it because levers like those are ones you only get to use once before other countries build an alternative, like when China shut down rare earth exports to japan years ago so countries like the US started up mines that were previously not worth it
- deleted 3y ago
  [deleted]
mjburgess 3y ago
Cryptocurrencies are peer-to-peer systems. If you control the network they're on, you can do anything you like. Take the peer-to-peer traffic of the cryptocurrency network of any area, prevent it from getting outside that area (ie., just block it talking to IPs outside some range) -- then to that network, you can trivially control the total hashing power. So split any cryptocurrency network into small segements, then add your machine to that network with a false history, design the network to be small enough, and your machine will out-hash the rest, and so it's history will win. Rinse-and-repeat. It's trivial for any state to take down a cryptocurrency. There's nothing magic about it; it's an incredibly fragile system whose 'safety' relies on no one owning the network, and if that's the case, no one being able to russle-up huge amounts of electricity. In both cases, this is false for states. So any state, if it wishes, can really do anything it likes. The global bitcoin system is well within rearch of a hostile state 51%'ing it, even at the global level -- though the cost would be non-trivial. It would be trivial to do it in its own borders though. As any state, of course will, if you can ever go into a shop and buy somehting with it. At that point you're imperilling a state's ability to use monetary policy to manage its economy, and that's an existential security threat. So bye bye your monopoly money tokens.
- whatshisface 3y ago
  That's an elaborate and wasteful way to achieve the same results as banning crypto.
- wongarsu 3y ago
  You would be able to control the part of the network you cut off, but if anyone smuggles in as much as a microSD card with the outside blockchain state and syncs it to their client, every client in the segment would see this longer chain (since the outside has more hash power than you) and recognize it as legitimate, undoing all your fraudulent transactions (along with a lot of legitimate ones that never reached the outside network)
- null0pointer 3y ago
  > So split any cryptocurrency network into small segements, then add your machine to that network with a false history, design the network to be small enough, and your machine will out-hash the rest, and so it's history will win. Rinse-and-repeat. You cannot forge history, even with 100% of the hash power. Firstly, each transaction is cryptographically signed with the keys of the sender address. Secondly, each full node within the segmented network will have the full history. The only thing you can do is publish different blocks to the segmented network than the blocks the outside network has. You cannot create arbitrary transactions. You can only censor others’ transactions within the segmented network. Since the mining difficulty will not adjust instantaneously your segmented network will fall behind the outside network in block height unless you control more hashing power than everyone else mining Bitcoin on either network combined. So as soon as anyone in your segmented network re-establishes connection with the outside network (and they will, they could receive a physical hard drive with the blockchain on it and rebroadcast to segmented nodes) all your work is for nothing. You might say “yeah well I’ll publish an entire fake history that is MUCH longer than the outside network with lower difficulty so I can stay ahead”. Well, actually you can’t, because if you wanted vastly more blocks between Bitcoins inception and the present then the difficulty will necessarily be much higher because that’s how difficulty gets set, by how quickly blocks are produced. You would have to change the difficulty adjustment algorithm, creating a fork between your own malicious node(s) and the other nodes in your segmented network. Oh and by the way, you _still_ can’t create arbitrary transactions. > The global bitcoin system is well within rearch of a hostile state 51%'ing it I’ll believe it when I see it. They honestly have a better chance outlawing it and imprisoning anyone who’s ever used it.

sk55 3y ago

Not really. Proof of stake offers a very energy efficient way to secure transactions. That is what Ethereum runs on.

Scoundreller 3y ago
I think the most efficient is a stable coin where you skip the step of actually backing it.

PretzelPirate 3y ago

> The "security" of any cryptocurrency is proportional to how much energy it wastes This only applies to Proof of Work blockchain.

tibbon 3y ago
Which is what Bitcoin uses, and it is one of the largest and most commonly used cryptocurrencies out there.
- Scoundreller 3y ago
  is it the most transacted? And it's share of transactions has gone down (from being the only choice to lots of choices) Largest market cap, yes, but also lots of probably lost coin. One source shows Tether having the most volume, and it's very energy efficient to make coin out of thin air.
- pcthrowaway 3y ago
  Yes, but bitcoin is something of an outlier there.. I realize the "top 100" cryptocurrencies by market cap isn't necessarily very meaningful, but like 90% of those are proof of stake, including ethereum, which is the second most valuable cryptocurrency, and actually more widely used than bitcoin in terms of transactions or number of unique wallets.

digging 3y ago

I'm not an expert here but my understanding is that even if a so-called 51% attack were to happen, it would only be meaningful as long as it could be sustained. The simplest case is a single tainted block, after which other miners could roll back by consensus. If a nation wanted to "permanently" take over >50% of the network, I believe the Bitcoin community would see that coming, and it would be a colossal investment of energy for a not-very-good chance of taking over. Bitcoin.

mjburgess 3y ago
only of the global network. states own the network infra in their borders, so they can partition it to any size they wish.
treyd 3y ago
> The simplest case is a single tainted block, after which other miners could roll back by consensus. Invalid blocks are rejected trivially by any node as soon as it sees them. You can't "force" an invalid block to be accepted by throwing hashrate at it and miners don't need to do anything to make an invalid block be recognized as such. The issue is on malicious actors trying to rewrite/replace recent blocks (to double spend, usually) which was the core innovation, but that also includes trying to censor txs or generally DoS the network by refusing to allow txs to be accepted.

WinstonSmith84 3y ago

> The "security" of any cryptocurrency is proportional to how much energy it wastes Oops, nope sorry. Most don't use PoW..

Throw73747 3y ago

> 51% attack it. If you can outwaste energy, you can hijack the system Out hashing does not give you any extra powers. Maybe you will be able to rollback a few minutes of transactions, that is all.

mjburgess 3y ago
if you split the network, you can add your own machines, that can rewrite the history arbitrarily from the future of that split. As for "a few minutes", it depends on which one we're talking about. BTC, yes -- but disrupting the global BTC network requires only a few minutes of time. Just dump everything into unusable addresses, and watch the reaction.
- rlpb 3y ago
  > can rewrite the history arbitrarily No, you cannot do that. Transactions would still need to be signed by the corresponding owners. All you could do is reorder (and thus invalidate) some transactions, drop some transactions, or add some that weren't originally included. > Just dump everything into unusable addresses... Nope; that's not possible. You wouldn't have the signatures to do that even with 51% hashing power.
  - mjburgess 3y ago
    You're right about the dumping; I was thinking more about the case where you controlled the protocol on the machines of a partitioned network (eg., so you release a new version of btc which uses exploitable crytography, etc.). In the case of a mere 51% at scale, hijinks are still quite possible from replays, reorderings, etc. I was more preoccupied by the case where the state's acting in its own borders with control over the network, major miners, most machines on the network -- at this point basically no gaurentees remain
    - rlpb 3y ago
      > the case where you controlled the protocol on the machines of a partitioned network (eg., so you release a new version of btc which uses exploitable crytography Such a change would be treated as a "monopoly money" fork by those wanting to transact, and ignored. "No I don't want your fake money; send me real BTC or GTFO". This is why miners cannot arbitrarily change the protocol in their favour even today.

wongarsu 3y ago

> The "security" of btc cryptocurrency is proportional to how much energy it wastes It's proportional to the amount of money it "burns", in the form of capital costs (miners) and electricity costs (for those miners). If electricity prices would rise tenfold globally, electricity use from crypto miners would drop by about the same factor.

FabHK 3y ago

Yes. PoW blockchains: energy efficient, secure, supporting a highly valuable crypto currency - pick any two.