6 confirmations is not enough

[User705]

This will not happen. People think that it is easy to trick the network, well it is not.
You're making inexperienced people fear Bitcoin for no valid reason..

Explain why this won't work when cloud mining dominates?

Why will cloud mining dominate?

Regardless, let's assume it does.

Someone owns the hardware. Will the providers continue to sell hashrate to someone who's actions will render the hardware (and therefore their entire business model) worthless? Maybe, if they are extremely stupid.

What happens when the hardware is already worthless (doesn't mine enough to cover electricity costs)?

Are you asking what happens when a cloud mining provider sells hash rate at a loss? I would assume that they go out of business.

No and I think you know that.
Your statement that a hashrate provider would not do anything underhanded when the value of their equipment is at stake is being questioned by the fact that said equipment might already be worthless.  At that point the "rational" thing to do would be to maximize the value of it.  So no they wouldn't be extremely stupid.

[kokojie]

The exchanges can easily change the rule to wait for number of confirmations according to the value transferred. For 1000 BTC, they can require 15 confirmations for example. And for 10000 BTC, maybe 30 confirmation

[Come-from-Beyond]

The exchanges can easily change the rule to wait for number of confirmations according to the value transferred. For 1000 BTC, they can require 15 confirmations for example. And for 10000 BTC, maybe 30 confirmation

Right. This is what I asked.

It would be interesting to see the formula that tells what values are enough to convince 51% of the miners to re-mine the last blocks...

[MrTeal]

Right. This is what I asked.

It would be interesting to see the formula that tells what values are enough to convince 51% of the miners to re-mine the last blocks...

That's a more complicated question than you are implying. It's more like asking what the dollar value of a car has to be before someone taking it for a test drive will steal it rather than return it.

[rfcdejong]

6 confirmations take around 1 hour on average, as a customer i don't want to wait 1 hour to be confirmed..

Bitcoin transactions take too long already, don't say 6 confirmations is not enough.

However i would like to see a succesfull attack, but i think that will never happen, wouldn't it happened before by now then?

[R2D221]

6 confirmations take around 1 hour on average, as a customer i don't want to wait 1 hour to be confirmed..

Bitcoin transactions take too long already, don't say 6 confirmations is not enough.

However i would like to see a succesfull attack, but i think that will never happen, wouldn't it happened before by now then?

6 confirmations is astronomical. You only need 1 confirmation, and even then, there are techniques to accept unconfirmed transactions with almost zero risk (so you won't need to wait 10 minutes to buy your coffee).

[redsn0w]

6 confirmations take around 1 hour on average, as a customer i don't want to wait 1 hour to be confirmed..

Bitcoin transactions take too long already, don't say 6 confirmations is not enough.

However i would like to see a succesfull attack, but i think that will never happen, wouldn't it happened before by now then?

6 confirmations is astronomical. You only need 1 confirmation, and even then, there are techniques to accept unconfirmed transactions with almost zero risk (so you won't need to wait 10 minutes to buy your coffee).

You're right. For example greenAddress allows the tx between two wallets GA with an instant confirm (there isn't needed to wait no confirmation).

GA= greenAddress.

[tss]

Is it really works?  Any one have experience/experiment with it?

no it doesn't.  unless you control majority of hash.

[inBitweTrust]

It would be interesting to see the formula that tells what values are enough to convince 51% of the miners to re-mine the last blocks...

This is a question that can never be calculated because it needs to account for the underlying motivations of the miners which also include many motivations outside of immediate profit. They are concerned with the longterm viability of Bitcoin for sustainable profitability and most have ethical motivations which prevent them from attacking the network.

PS: I wouldn't trust to reasonings of colinistheman because he is biased:

2.) And yes I possess BTC.

quote mining out of context now?

2.) And yes I possess BTC.
As a bonus answer, I also possess NXT.

[silversurfer1958]

Wouldn't limiting Fees to a small amount de incentivise this possibility.

[thriftshopping]

A rational miner is going to attempt to sabotage the system for possible short term gain? If he succeeds, the coins are soon going to be worthless. Now the "rational" miner's hardware is also worthless.

Actual "rational" miners won't build on the attacker's chain because they don't want to throw away their very real hardware investment. Pool operators aren't going to build on this guy's chain either (they understand that their hardware can be "taken" from them at any moment).

To pull this off you need to buy enough soon-to-be-worthless hardware to 51% the network. So we are back to the same old 51% attack discussion. Good job OP!

This

However even if you were to ignore the above you need to look at the probability of a miner being able to mine 6 consecutive blocks, which is very small for the entire network as it stands now, so any miner attempting this would be giving up a guaranteed block reward in exchange for a very low chance of a 500 BTC block reward

[zetaray]

While the attacking pool trys to mine 6 block to reverse the transaction, the main chain is also mining. The attacking pool needs double the hash rate of the main chain to achieve this attack Or be very lucky. Too risky for any pool to try.

[ABitNut]

A rational miner is going to attempt to sabotage the system for possible short term gain? If he succeeds, the coins are soon going to be worthless. Now the "rational" miner's hardware is also worthless.

Actual "rational" miners won't build on the attacker's chain because they don't want to throw away their very real hardware investment. Pool operators aren't going to build on this guy's chain either (they understand that their hardware can be "taken" from them at any moment).

To pull this off you need to buy enough soon-to-be-worthless hardware to 51% the network. So we are back to the same old 51% attack discussion. Good job OP!

This

However even if you were to ignore the above you need to look at the probability of a miner being able to mine 6 consecutive blocks, which is very small for the entire network as it stands now, so any miner attempting this would be giving up a guaranteed block reward in exchange for a very low chance of a 500 BTC block reward

But when two entities could join up to instantly get 50% of the network and some creative criminals may lead to some elaborate scheme where they 1) take a short position 2) scam to get instant profit 3) which causes BTC to crash, giving extra profit from the short position and if planned properly provides 4) a way out for BTC through some new entity that they control.

Put on your tinfoil hats. If the potential reward is big enough someone will get corrupted enough to do it.

[Come-from-Beyond]

quote mining out of context now?

2.) And yes I possess BTC.
As a bonus answer, I also possess NXT.

I think he got 3 NXT from a faucet.

[Come-from-Beyond]

Wouldn't limiting Fees to a small amount de incentivise this possibility.

No, because an attacker may create 1000 transactions with 0.5 BTC fee each.

[Come-from-Beyond]

Even you success do that, i'm sure soon after that everyone will afraid that will happen again.
Than everyone sell their bitcoin & your bitcoin will be useless

This case could destory bitcoin price

Good advice. Once I get the 500 BTC back I'll send them to another exchange and withdraw in XRP.

[MrTeal]

Even you success do that, i'm sure soon after that everyone will afraid that will happen again.
Than everyone sell their bitcoin & your bitcoin will be useless

This case could destory bitcoin price

Good advice. Once I get the 500 BTC back I'll send them to another exchange and withdraw in XRP.

Do you use the ripple to offset some of the losses on the $30M worth of mining hardware you used in your attack that has now lost the majority of its value?

[Come-from-Beyond]

Do you use the ripple to offset some of the losses on the $30M worth of mining hardware you used in your attack that has now lost the majority of its value?

No, according to the scenario, I just bribe miners.

[MrTeal]

Do you use the ripple to offset some of the losses on the $30M worth of mining hardware you used in your attack that has now lost the majority of its value?

No, according to the scenario, I just bribe miners.

So you believe a rational miner would accept the 500BTC in fees in place of the (150BTC/2) in block rewards in order to attack an exchange for a $93,500 profit, irregardless of the potential damage it might cause to the valuation of the $30-50M worth of equipment they need to use to help you with the attack?

[MrTeal]

As another scenario, if you actually could get 50+% of miners to agree to a scheme like this, why wouldn't you just have them start mining their own blocks and not including any blocks from other miners? They could maintain the longest chain at no cost to themselves, and once the difficulty drops substantially due to the blocks from the other 45% or so of miners not being included they would effectively be almost doubling their income (in BTC) at no cost. That would give them massively more than a couple hundred BTC.