4 ms·

> Some predecessors, like DigiCash, were too reliant on trusted authorities and so never gained market acceptance. Aren’t bitcoin holders trusting that no auth

> Some predecessors, like DigiCash, were too reliant on trusted authorities and so never gained market acceptance. Aren’t bitcoin holders trusting that no authority/state actor is going to 51% attack the blockchain?

codetrotter 3y ago
A timeless classic on this question: https://m.youtube.com/watch?v=ncPyMUfNyVM https://m.youtube.com/watch?v=ncPyMUfNyVM
- npoc 3y ago
  I'd like to hear how he'd kick the bad actors off the network. Bitcoin is fundamentally permissionless.
drdeca 3y ago
I suppose, but, not on the basis of "they are granted the authority to do this thing, but will not abuse it", so much as, "it is costly for them to do this thing, and it is unlikely to be worth it to them" ?
_heimdall 3y ago
More specifically, bitcoin holders are trusting that some collection of entities with more than 50% share of the mining power won't collude. It seems like a reasonable assumption honestly, everyone would know and value would tank. I'm by no means a fan of bitcoin, but miner collusion was never what kept me away. I like the original arguments for bitcoin related to a decentralized currency and privacy. Neither have proven to be possible on the bitcoin blockchain and I see absolutely no value in btc if I have to use off chain solutions to make it fit any real world use case.
- odyssey7 3y ago
  If a party could control the irregular tide of Bitcoin’s value rising and crashing, then it holds a means to stimulate or impoverish whatever economies rely on Bitcoin. This could be particularly attractive for parties who want to avoid formally declaring sanctions or for situations where sanctions might not be effective. I would see a 51% attack as a nuclear option, since it could take a while for cryptocurrency users to once again believe that the network is secure, but you could imagine a situation where there is geopolitical conflict with a country, the people in that country adopt a cryptocurrency due to fiat currency collapse, and then it becomes useful to induce a cryptocurrency collapse as well. Edit: oops, might have added this comment in the wrong place.
deleted 3y ago
[deleted]
oersted 3y ago
Off the top of my head: it seems unlikely that you can recoup the enormous investment required to get to 51% by making fraudulent transactions without anyone noticing and crashing the value of bitcoin, or agreeing to switch to a clean fork. I'm not sure how early users tolerated this risk though.
- xur17 3y ago
  A 51% attack allows you to rewrite history, which allows you to "double spend". For example, you could send funds to an exchange and withdraw them in cash, then during the attack send them to yourself instead. The amount of computer power defines how far back you can reorg the chain. The transactions you create still have to follow protocol rules, which means you can only send funds from wallets you have the keys for - you cannot create money out of thin air, or steal funds from someone else's wallet.
  - oersted 3y ago
    You can't "double spend" without anyone noticing, even a minimal amount is in theory detectable by the exchange and the word would spread like fire. Perhaps the exchange would let it go if the amount is small enough, so that the value of the currency doesn't crash for everyone, but remember you are trying to recoup the enormous investment needed to get to 51%. It's true that you can withdraw a large amount of money once, let the whole thing crash and run away with the cash. But you need to control that money to withdraw it, so you'd need to take it from other's accounts using your 51% advantage, and get the cash from the exchange before anyone notices. How are you gonna do that for such a large amount of money? The exchange would never let you withdraw anywhere close to such an amount anyways, they just don't have it. Even if you somehow do it on all exchanges at the same time, it's too much. Even if they somehow have the capital, they just wouldn't let you, because they know it will tank the value of the currency, even if the withdrawal is legitimate. I really can't see how you can steal more than you spent with the 51% move. The only thing you can do is spend a lot of money to crash the currency with a big loss on your side.
    - phire 3y ago
bigcoke 3y ago
you could go further and say that bitcoin holders are trusting that no major vulnerability will be found on the network.
- npoc 3y ago
  yes absolutely. But it's been going strong for 15 years now, completely open for attack 24/7 and with an enormous bounty for anyone successful. And yet, tick-tock, next block.

codetrotter 3y ago

A timeless classic on this question: https://m.youtube.com/watch?v=ncPyMUfNyVM https://m.youtube.com/watch?v=ncPyMUfNyVM

npoc 3y ago
I'd like to hear how he'd kick the bad actors off the network. Bitcoin is fundamentally permissionless.

drdeca 3y ago

I suppose, but, not on the basis of "they are granted the authority to do this thing, but will not abuse it", so much as, "it is costly for them to do this thing, and it is unlikely to be worth it to them" ?

_heimdall 3y ago

More specifically, bitcoin holders are trusting that some collection of entities with more than 50% share of the mining power won't collude. It seems like a reasonable assumption honestly, everyone would know and value would tank. I'm by no means a fan of bitcoin, but miner collusion was never what kept me away. I like the original arguments for bitcoin related to a decentralized currency and privacy. Neither have proven to be possible on the bitcoin blockchain and I see absolutely no value in btc if I have to use off chain solutions to make it fit any real world use case.

odyssey7 3y ago
If a party could control the irregular tide of Bitcoin’s value rising and crashing, then it holds a means to stimulate or impoverish whatever economies rely on Bitcoin. This could be particularly attractive for parties who want to avoid formally declaring sanctions or for situations where sanctions might not be effective. I would see a 51% attack as a nuclear option, since it could take a while for cryptocurrency users to once again believe that the network is secure, but you could imagine a situation where there is geopolitical conflict with a country, the people in that country adopt a cryptocurrency due to fiat currency collapse, and then it becomes useful to induce a cryptocurrency collapse as well. Edit: oops, might have added this comment in the wrong place.

deleted 3y ago

[deleted]

oersted 3y ago

Off the top of my head: it seems unlikely that you can recoup the enormous investment required to get to 51% by making fraudulent transactions without anyone noticing and crashing the value of bitcoin, or agreeing to switch to a clean fork. I'm not sure how early users tolerated this risk though.

xur17 3y ago
A 51% attack allows you to rewrite history, which allows you to "double spend". For example, you could send funds to an exchange and withdraw them in cash, then during the attack send them to yourself instead. The amount of computer power defines how far back you can reorg the chain. The transactions you create still have to follow protocol rules, which means you can only send funds from wallets you have the keys for - you cannot create money out of thin air, or steal funds from someone else's wallet.
- oersted 3y ago
  You can't "double spend" without anyone noticing, even a minimal amount is in theory detectable by the exchange and the word would spread like fire. Perhaps the exchange would let it go if the amount is small enough, so that the value of the currency doesn't crash for everyone, but remember you are trying to recoup the enormous investment needed to get to 51%. It's true that you can withdraw a large amount of money once, let the whole thing crash and run away with the cash. But you need to control that money to withdraw it, so you'd need to take it from other's accounts using your 51% advantage, and get the cash from the exchange before anyone notices. How are you gonna do that for such a large amount of money? The exchange would never let you withdraw anywhere close to such an amount anyways, they just don't have it. Even if you somehow do it on all exchanges at the same time, it's too much. Even if they somehow have the capital, they just wouldn't let you, because they know it will tank the value of the currency, even if the withdrawal is legitimate. I really can't see how you can steal more than you spent with the 51% move. The only thing you can do is spend a lot of money to crash the currency with a big loss on your side.
  - phire 3y ago

bigcoke 3y ago

you could go further and say that bitcoin holders are trusting that no major vulnerability will be found on the network.

npoc 3y ago
yes absolutely. But it's been going strong for 15 years now, completely open for attack 24/7 and with an enormous bounty for anyone successful. And yet, tick-tock, next block.