When SHA-256 is compromised

[Rampion]

1) SHA-256 compromised as in there is a quick way to discover the nonce required to produce the valid block hash.
Assuming the discoverer is malicious and stupid:
2) Attacker zip through blocks, providing instant confirmation for his malicious activities.
3) Attacker tries to sell all the coins.
4) Exchanges freeze.
5) No one needs convincing that the hashing algorithm is really broken.
6) Bitcoin algorithm switched
7) Everyone agrees to rewind to a block before the attack
8 ) bitcoin continues.

Assuming the discoverer is malicious and smart:
2) Attacker zip through blocks at 5 minutes interval to avoid detection.
3) When this has happened for a while, more and more people will become suspicious
4) 5 - 8 will happen.


Assuming the discoverer is benevolent:
2) Research claims SHA-256 compromised
3) demonstrates this by zipping pass a few blocks.
4) 4-8 in the stupid attacker case happens.

I have left out the other serious implications of the complete breakdown of SHA-256.  

 

4-5 would be too hard for it to happen.
Another coin would replace it that uses different security.
A coin with more security like Quark Coin would most likely replace it or another alt coin that uses another security.
The general public would not be able to trust Bitcoin again even if 4-8 happens.

How is that quark coin is more secure with that ridiculously fast maturing?

[kcirazy]

Such a move will take years.  The first step would probably be to alter the Bitcoin protocol to allow a different hashing method.  This hashing method would not be valid until the majority of miners and clients had moved to the protocol version that supports the new hash method.  Then we enter the time of dual hashing.  Old-style double-SHA256 hashes would be valid, but new style DERP512 hashes would also be equally valid.  After enough time has passed, and enough blocks are mined using DERP512 instead of double-SHA256 (say, 10 to 1) then the network could cut over to only accept the new hashes, and the old miners would be retired.  At least, that's one way to do it.

Ah I didn't consider this scenario ... that might actually be a good way to convince miners to invest in new hardware, while not completely losing their old investments.

[Kazimir]

Folks, read the Bitcoin whitepaper, use the search engine, and in general just assume whatever flaw with Bitcoin that occurs to your brain, has already occurred along with a dozen others to someone with 160+ IQ

http://bitcoin.org/bitcoin.pdf

This.