The future of Bitcoins

[socrates]

When reading about bitcoins, I came across the 51% attack concept. This is something that any entity with enough money can do. If Bitcoins really become a dominant force and threaten any of the major currencies, is it not possible that they would launch a 51% attack and control or destroy the bitcoin system? Or, is there a built-in protection available in the technology to prevent this?

[creativex]

Distributed mining is the defense against attack.

[socrates]

Distributed mining is the defense against attack.

Which implies that it needs a defense. Sans that it can be brought down. Governments can ban GPUs, mining rigs etc. so the defense gets weak while they can have powerful hardware.

What does the technology have to prevent such a thing from occurring?

[DarkHyudrA]

Distributed mining is the defense against attack.

Which implies that it needs a defense. Sans that it can be brought down. Governments can ban GPUs, mining rigs etc. so the defense gets weak while they can have powerful hardware.

What does the technology have to prevent such a thing from occurring?

Bitch please, ban computer parts?
They don't need to make a PC revolution to make a 51% attack, they have lots of super-computers to make a lot of floating points operations that, if they want it today, they can make the 51% attack.

[greyhawk]

Distributed mining is the defense against attack.

Which implies that it needs a defense. Sans that it can be brought down. Governments can ban GPUs, mining rigs etc. so the defense gets weak while they can have powerful hardware.

What does the technology have to prevent such a thing from occurring?

Bitch please, ban computer parts?

They are doing this right now in the Euro states. Legislation is being enacted to ban the sale of high-end graphics cards.

[creativex]

Hey now! That's to make the world a better, greener place.

It's for your own good, now TAKE YOUR MEDICINE.

[creativex]

Distributed mining is the defense against attack.

Which implies that it needs a defense. Sans that it can be brought down. Governments can ban GPUs, mining rigs etc. so the defense gets weak while they can have powerful hardware.

What does the technology have to prevent such a thing from occurring?

Miners are both the defenders of BTC and the minters of BTC.

ASICs are around the corner, but whether that makes the network safer or not is open for debate. I tend to think it does.

[greyhawk]

Hey now! That's to make the world a better, greener place.

It's for your own good, now TAKE YOUR MEDICINE.

They're messing with my GAMES!  Imma grab my raygun and shoot them all too kingdom come.  *


* Disclaimer: There is no scientific evidence linking video games and propensity for violence. Now shut up about it before I kill you slowly and painfully.

[Lethn]

http://www.nordichardware.com/Graphics/updated-eu-cripples-future-graphics-cards-exclusive.html

Come on guys, link articles etc. so people don't think your crazy.

Messing with video games won't make me violent, however if you touch my porn you better pray to whatever gods you believe in.

[Foxpup]

If you have 51% of the network hashing power, there are two things you can do with it:

• Secretly (but entirely legitimately) mine more bitcoins than the rest of the network combined, making you insanely wealthy; OR
• Do a 51% attack, which cannot be done without the rest of the network knowing about, causing a mass panic and a loss of faith in the system, greatly reducing the value of any coins you mine.

These options are mutually exclusive. You can either get rich or attack the network, but not both. There is a very strong economic incentive to not perform a 51% attack. A built-in bribe for potential attackers, if you will. Of course, a politically-motivated attacker might care more about disrupting the network than their own wealth, but really, what are the chances of that ever happening?

[creativex]

Come on guys, link articles etc. so people don't think your crazy.

...perhaps that's why there was no link? Just sayin'. ;p

[greyhawk]

Crap, now I'm gonna have to find a brand new way to seem crazy.

Maybe I could imitate usagi, that should work, shouldn't it?

[Gabi]

but really, what are the chances of that ever happening?

Well, not so low...

[Atruk]

Distributed mining is the defense against attack.

Which implies that it needs a defense. Sans that it can be brought down. Governments can ban GPUs, mining rigs etc. so the defense gets weak while they can have powerful hardware.

What does the technology have to prevent such a thing from occurring?

Bitch please, ban computer parts?
They don't need to make a PC revolution to make a 51% attack, they have lots of super-computers to make a lot of floating points operations that, if they want it today, they can make the 51% attack.

Not really.

There are super computers, but generally they are already committed to tasks other than fucking with bitcoins and floating point operations also don't have much to do with SHA-2 hashing. There isn't a single supercomputer that could 51% the bitcoin network on its own. Traditional and even newer GPGPU supercomputers are actually a really shitty way to attempt a 51% attack.

[socrates]

they have lots of super-computers to make a lot of floating points operations that, if they want it today, they can make the 51% attack.

but really, what are the chances of that ever happening?

If Bitcoins really become a dominant force and threaten any of the major currencies, is it not possible that they would launch a 51% attack and control or destroy the bitcoin system?

When bitcoins threaten any major currency or the government control of economy, then they will have an incentive to make the 51% attack. That's when the chances of it happening go up.

I am still interested in knowing if there is anything in the technology that can thwart this.

[Foxpup]

but really, what are the chances of that ever happening?

Well, not so low...

What are you suggesting? That a political organisation might turn down a massive bribe? Maybe you're forgetting just how massive it is. We're talking about 51% of all transaction fees, plus 51% of all newly-created money, of a worldwide currency. That's a central banker's dream (well, they dream of complete control, but I think they're all aware that's never going to happen with a world currency). You really think anyone would rather try to destroy us (with no guarantee of success, I might add) than take a 51% cut? I don't.

[DannyHamilton]

but really, what are the chances of that ever happening?

Well, not so low...

. . . We're talking about 51% of all transaction fees, plus 51% of all newly-created money, of a worldwide currency . . .

You are mistaken.  If you can maintain 51% of the total hashing power on the network, you will acquire 100% of all transaction fees, plus 100% of all newly-created money.  For as long as you maintain 51% of the total network hashing power, you get to create ALL blocks.  Even if others happen to create a few blocks and get ahead of you for a bit, you will eventually overtake them orphaning their blocks and replacing them with your own.

[DannyHamilton]

When bitcoins threaten any major currency or the government control of economy, then they will have an incentive to make the 51% attack. That's when the chances of it happening go up.

I am still interested in knowing if there is anything in the technology that can thwart this.

Some would say that bitcoins already threaten all major currencies and the government control of the economy.

The technology is designed such that it becomes more difficult and more expensive to engage in a 51% attack as more people take up mining.  There is a cascading chain of events here...

The more mainstream bitcoin becomes, the more people want it.
The more people want bitcoin, the higher the exchange rate and the higher the value of the block reward and transaction fees.
The higher the value of the block reward and transaction fees, the more incentive there is for miners to try to get some of that money.
The more incentive there is for miners to try to get some of that money, the more mining equipment that enters the network.
The more mining equipment on the network, the higher the total network hashrate.
The higher the total network hashrate, the more money a government entity would need to spend to perform a 51% attack.

So, the current cost of a 51% attack is pretty expensive but not outside the realm of possibility for a well funded entitiy such as large government.  However, the future cost of a 51% attack is likely to be significantly higher.  Will it be high enough to prevent a government from attempting it if/when they decide to try?  We'll have to wait and see.

[Foxpup]

but really, what are the chances of that ever happening?

Well, not so low...

. . . We're talking about 51% of all transaction fees, plus 51% of all newly-created money, of a worldwide currency . . .

You are mistaken.  If you can maintain 51% of the total hashing power on the network, you will acquire 100% of all transaction fees, plus 100% of all newly-created money.  For as long as you maintain 51% of the total network hashing power, you get to create ALL blocks.  Even if others happen to create a few blocks and get ahead of you for a bit, you will eventually overtake them orphaning their blocks and replacing them with your own.

You're confusing nominal value with real value. A 51% attack can't be kept secret, it will be discovered pretty much instantly, and then who's going to buy your bitcoins or accept them as payment? Nobody, that's who. If there's ever a 51% attack, the attacker's coins (along with everyone else's) will be worthless, and if the attack continues for any length of time, they'll never recover their value as all faith in the security of the network vanishes. Alternatively, you could decide to not orphan everyone else's blocks, and then nobody will be the wiser, there'll be no drop in value, and you get to keep 51% of everything. I'd much rather have 51% of something valuable than 100% of something worthless, but maybe that's just me.

[Gabi]

There isn't a single supercomputer that could 51% the bitcoin network on its own. Traditional and even newer GPGPU supercomputers are actually a really shitty way to attempt a 51% attack.

And? You don't even need a supercomputer for that. Just buy enough GPU (or ASIC once they are released) and ta-dah, 51% attack. Cost? You can do it today with less than 20 millions (probably with 10 millions, and i'm speaking about buying all the hardware, buying the building and the infrastructure to put that into, hire enough ppl and blablabla). 20 millions $ is CHEAP if you are a rich person/bank/government. Very cheap.

What are you suggesting? That a political organisation might turn down a massive bribe? Maybe you're forgetting just how massive it is. We're talking about 51% of all transaction fees, plus 51% of all newly-created money, of a worldwide currency. That's a central banker's dream (well, they dream of complete control, but I think they're all aware that's never going to happen with a world currency). You really think anyone would rather try to destroy us (with no guarantee of success, I might add) than take a 51% cut? I don't.

"massive"? Some millions $ is "massive" for you? Oh LOL. In case you don't know the guys i'm speaking about (banks, governments, etc) daily spend billions of $. Dozens of thousands of millions. The 51% cut is peanuts for them.
Also remember, if bitcoin become successfull they will lose billions.

the current cost of a 51% attack is pretty expensive

I find it cheap. 20 millions? A soccer player gains more money in a year... clubs spend dozens of millions to buy one. Some years ago they bought Ronaldo for 90 millions.