5 ms·

The cheapest hardware listed on the page linked before is 2.5 GHash/s/$. This yields hardware worth 100 million Dollars as a lower bound. But I did not think so

by danbruc 12y ago

The cheapest hardware listed on the page linked before is 2.5 GHash/s/$. This yields hardware worth 100 million Dollars as a lower bound. But I did not think so much about hardware costs when I said that it is probably underestimated but because I picked the efficiency from the top of the range and energy costs from the bottom. And it does not necessarily break anything but the security of Bitcoin is build on the assumption that it is very hard for any single entity to posses the majority of the hash rate. If you take the 100 million Dollars of hardware, reducing the hash rate tenfold will make the network attackable with only 10 million Dollars which seems pretty cheap to me. And being vulnerable does not imply the attack is actually executed, it only means it could happen anytime. But do you want your money in a system that could be attack anytime?

logicallee 12y ago
As I mentioned, 51% of the network did get controlled by one single entity. The question "do you want your money in a system that could be attacked anytime" has two answers: "Yes" or "I don't want any money." There is no perfectly secure third alternative.
- danbruc 12y ago
  They controlled 51 % and decided not to abuse their power. But the idea behind Bitcoin is that you don't have to trust any single entity and if you allow this to happen this idea goes straight out of the window. You could just as well throw out all the expensive cryptographic stuff, send them your transactions and let them manage them in an Excel sheet and hope they will not abuse your trust.
  - kanzure 12y ago
    > You could just as well throw out all the expensive cryptographic stuff, send them your transactions and let them manage them in an Excel sheet Hmm, that's not really how these attacks work. When a miner doesn't mine according to the rules, their blocks are invalid and rejected by the network. edit: Unfortunately you have now given me an opportunity to admit that Excel is probably capable of running Bitcoin-equivalent software, though.... I would prefer not thinking about this.
  - ikeboy 12y ago
    There was a 51% attack against a gambling site before http://arstechnica.com/security/2014/06/bitcoin-security-guarantee-shattered-by-anonymous-miner-with-51-network-power/ http://arstechnica.com/security/2014/06/bitcoin-security-gua...
  - logicallee 12y ago
    But you don't actually mean "You could just as well throw out all the expensive cryptographic stuff, send them your transactions and let them manage them in an Excel sheet and hope they will not abuse your trust." You think you mean this, but you simply don't. It's a nice ideal but none of it is true. The broken system we have, where 51% decided not to abuse their power, works. A trivial replacement without any cryptography relying on the honor system demonstrably (and obviously) doesn't. That is not an insignificant difference. While you would like the cryptography to be provably secure, it simply isn't (51% control-by-one-group actually happened), and it wasn't a disaster. It was still far better than the alternative. The world is not black and white.
    - danbruc 12y ago
      The original point was that lowering the hash rate is dangerous. As it turns out it is even dangerous at the current hash rate and distributions of this hash rate seen in the past. There have already been at least attempts of abuse. And again, the idea of Bitcoin is to remove the need of trusted entities. If you accept entities with more than 50 % of the hash rate, this idea is just gone. You have to trust them. Nobody says it can not work, but there is no guarantee that it will work. And I did of course not seriously suggest to use a spreadsheet or even a shared spreadsheet. I set up a server here at home and write a bit of code that collects Bitcoin transactions and updates balances in my database. This is as secure as Bitcoin with me having more than 50 % of the hash rate. If I am a nice guy everything is fine, if I have a bad day you are screwed. Okay, not exactly but close enough. And to finally come back to lowering the hash rate - if you make 50 % of the hash rate as cheap as 10 million Dollars any larger company or almost any state could just buy a few pieces of hardware and destroy Bitcoin. They would just have to generate empty blocks as fast as possible. You will have a hard time moving your coins to an exchange to cash them out. And even if you manage to do that, Bitcoins won't be worth anything in that scenario. Everybody just lost almost all of their money and this is just what Bitcoin was supposed to prevent.
      - logicallee 12y ago
        So what is their incentive to do so? (That causes them to actually do so)? You are insecure because anyone can just kill you with a rock when you're not looking. So what - nobody is going to do so.

by danbruc 12y ago

logicallee 12y ago

As I mentioned, 51% of the network did get controlled by one single entity. The question "do you want your money in a system that could be attacked anytime" has two answers: "Yes" or "I don't want any money." There is no perfectly secure third alternative.

danbruc 12y ago
They controlled 51 % and decided not to abuse their power. But the idea behind Bitcoin is that you don't have to trust any single entity and if you allow this to happen this idea goes straight out of the window. You could just as well throw out all the expensive cryptographic stuff, send them your transactions and let them manage them in an Excel sheet and hope they will not abuse your trust.
- kanzure 12y ago
  > You could just as well throw out all the expensive cryptographic stuff, send them your transactions and let them manage them in an Excel sheet Hmm, that's not really how these attacks work. When a miner doesn't mine according to the rules, their blocks are invalid and rejected by the network. edit: Unfortunately you have now given me an opportunity to admit that Excel is probably capable of running Bitcoin-equivalent software, though.... I would prefer not thinking about this.
- ikeboy 12y ago
  There was a 51% attack against a gambling site before http://arstechnica.com/security/2014/06/bitcoin-security-guarantee-shattered-by-anonymous-miner-with-51-network-power/ http://arstechnica.com/security/2014/06/bitcoin-security-gua...
- logicallee 12y ago
  But you don't actually mean "You could just as well throw out all the expensive cryptographic stuff, send them your transactions and let them manage them in an Excel sheet and hope they will not abuse your trust." You think you mean this, but you simply don't. It's a nice ideal but none of it is true. The broken system we have, where 51% decided not to abuse their power, works. A trivial replacement without any cryptography relying on the honor system demonstrably (and obviously) doesn't. That is not an insignificant difference. While you would like the cryptography to be provably secure, it simply isn't (51% control-by-one-group actually happened), and it wasn't a disaster. It was still far better than the alternative. The world is not black and white.
  - danbruc 12y ago
    The original point was that lowering the hash rate is dangerous. As it turns out it is even dangerous at the current hash rate and distributions of this hash rate seen in the past. There have already been at least attempts of abuse. And again, the idea of Bitcoin is to remove the need of trusted entities. If you accept entities with more than 50 % of the hash rate, this idea is just gone. You have to trust them. Nobody says it can not work, but there is no guarantee that it will work. And I did of course not seriously suggest to use a spreadsheet or even a shared spreadsheet. I set up a server here at home and write a bit of code that collects Bitcoin transactions and updates balances in my database. This is as secure as Bitcoin with me having more than 50 % of the hash rate. If I am a nice guy everything is fine, if I have a bad day you are screwed. Okay, not exactly but close enough. And to finally come back to lowering the hash rate - if you make 50 % of the hash rate as cheap as 10 million Dollars any larger company or almost any state could just buy a few pieces of hardware and destroy Bitcoin. They would just have to generate empty blocks as fast as possible. You will have a hard time moving your coins to an exchange to cash them out. And even if you manage to do that, Bitcoins won't be worth anything in that scenario. Everybody just lost almost all of their money and this is just what Bitcoin was supposed to prevent.
    - logicallee 12y ago
      So what is their incentive to do so? (That causes them to actually do so)? You are insecure because anyone can just kill you with a rock when you're not looking. So what - nobody is going to do so.