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Bitcoin Gold Hit by Double Spend Attack, Exchanges Lose Millions

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Re: Bitcoin Gold Hit by Double Spend Attack, Exchanges Lose Millions

#91

Post by celticninja »

patmcc wrote: post #46
mike-cardwell wrote: post #15

Earlier quoted context omitted.

I think stealing is illegal, yes.

Is this stealing by whatever definition police/the courts currently use? Isn't it an intentional part of the design of a cryptocurrency that decisions are made by a consensus based on hashing power? If you have 51% of the hashing power, you have control over that cryptocurrency; that's by design. Can you really steal at that point? edit: to those replying, I'm not saying this double spend is ethically fine, or not th…

It is not by design, it is a known weakness. The intent behind the actions also matters and it would be known to the malicious miner that to take these coins from exchanges would result in a loss to the exchange. So it would be illegal.

If however the miner maintained 51% + network share and then wrote some code to create new coins and adopted that code and mined blocks awarding himself 1000 coins for each block, he could legitimately do that and then sell those coins. Of course this could lead to the price dropping as soon as people realised what was happening and likely to happen before the attacker could send enough coins to an exchange to make the same sort of profit as in the situation in the article.

Re: Bitcoin Gold Hit by Double Spend Attack, Exchanges Lose Millions

#92

Post by tlarkworthy »

jhpriestley wrote: post #83

When Bitcoin was running up to $20,000, I tried to analyze the system and come to a personal conclusion about its equilibrium value, because I didn't want to miss out if it really was the currency of the future. I ended up not investing, because of the possibility of a double-spend attack. I think that cryptocurrency enthusiasts are seriously underestimating the importance of double-spending attacks to the economics…

I think the argument is that by doing a 51% attack you undermine the market value so you never get the rewards. This makes sense, but only for the leading crypto coin. As we see here today, you can 51% attack smaller coins, which should imply an increase in the value of Bitcoin from consolidation.

Re: Bitcoin Gold Hit by Double Spend Attack, Exchanges Lose Millions

#93

Post by v_lisivka »

baddox wrote: post #58
49bc wrote: post #8

Satoshi really downplayed 51% attacks in his/her original whitepaper[1]: > The incentive may help encourage nodes to stay honest. If a greedy attacker is able to assemble more CPU power than all the honest nodes, he would have to choose between using it to defraud people by stealing back his payments, or using it to generate new coins. He ought to find it more profitable to play by the rules, such rules that favour h…

But wouldn't the long-term honest mining be more profitable than a single hit and run? Kinda the same reason that when you go to a restaurant the restaurant owners almost always exchange food for money rather than rob you and leave town forever. If you own a restaurant it's generally more profitable to run it honestly than run away with a one-time dishonest payoff.

You cannot mine all kinds of coins at same time, so why not be honest in one network and hit and run in another?

Re: Bitcoin Gold Hit by Double Spend Attack, Exchanges Lose Millions

#94

Post by drexlspivey »

49bc wrote: post #37
gowld wrote: post #31

Earlier quoted context omitted.

The point is that stolen goods cost as much as mined goods, so why would an attacker prefer to steal? (Unless they are trying to vandalize the ecosystem)

The calculus to steal compared to mining is actually much cheaper. Just briefly hold 51% while you double spend some massive wallets.

Assuming the counterparty is an idiot and accepts your huge payment with a very low amount of confirmations.

Re: Bitcoin Gold Hit by Double Spend Attack, Exchanges Lose Millions

#96

Post by cies »

The team behind Cardano is proving their algorithms. I think they have even proven Bitcoin in the process, of proving their own algos.

I guess this is why one would like proofs, and proglangs that can (to some extend) incorporate the proofs/laws so your code is checked against them.

Re: Bitcoin Gold Hit by Double Spend Attack, Exchanges Lose Millions

#97

Post by nemo1618 »

bunderbunder wrote: post #64
mike-cardwell wrote: post #12

Crypto currencies are worthless unless they have an enormous amount of hashing power behind them. We could really do with a webpage with a list of crypto currencies, the hashing power currently behind them, and how much it would cost somebody to take over 50% of the network. Or does that already exist?

So, that's an interesting pair of ideas, in that it gets me thinking that any Bitcoin-style cryptocurrency might ultimately be doomed by its own design. Shooting from the hip: They've go this 51% vulnerability that is well known and hypothetically cannot be truly closed. Instead, we rely on the idea that mounting such an attack would be "too expensive". But at the same time, the cost/benefit of mounting such an attac…

On the other hand, there will be people who have a vested interest in preventing such attacks. If you own a lot of BTC, a successful attack can drastically lower the value of your assets, so it makes sense to deploy some of that capital to secure the network. And of course this goes even more so for business in the crypto space that rely on BTC remaining secure.

One example of this sort of behavior is in mining. We tend to think of miners as being selfish to a fault, and to some degree, that's true. But sometimes miners have the opportunity to mine empty blocks (a form of attack), and refrain from doing so, because it would harm the ecosystem as a whole and jeopardize their long-term profitability.

Re: Bitcoin Gold Hit by Double Spend Attack, Exchanges Lose Millions

#98

Post by drexlspivey »

jhpriestley wrote: post #83

When Bitcoin was running up to $20,000, I tried to analyze the system and come to a personal conclusion about its equilibrium value, because I didn't want to miss out if it really was the currency of the future. I ended up not investing, because of the possibility of a double-spend attack. I think that cryptocurrency enthusiasts are seriously underestimating the importance of double-spending attacks to the economics…

What a lot of people in the thread seem to be missing is that when you receive a huge payment you can require a higher amount of confirmations to accept it. High enough that it would make the 51% attack unprofitable.

Re: Bitcoin Gold Hit by Double Spend Attack, Exchanges Lose Millions

#99

Post by dragonwriter »

mike-cardwell wrote: post #84
celticninja wrote: post #63

Earlier quoted context omitted.

it exists https://bitinfocharts.com/comparison/bitcoin%20gold-hashrate...

That graph doesn't tell me how much it costs to launch a 50% attack. Maybe I'm just lazy, but I want a table with the name of the crypto currency in one column, and the cost in USD to launch an attack in another column.

> but I want a table with the name of the crypto currency in one column, and the cost in USD to launch an attack in another column.

Doesn't the cost depend on who you assume the attacker is? The required hashing power doesn't have the same acquisition and operating costs for all potential attackers.

Re: Bitcoin Gold Hit by Double Spend Attack, Exchanges Lose Millions

#100

Post by mike-cardwell »

georgemcbay wrote: post #27
tedunangst wrote: post #21

Earlier quoted context omitted.

Wherever the exchange is?

Does wherever the exchange is recognize Bitcoin Gold as legal tender? The issue seems a lot more complex than either "of course this is illegal" or "of course this isn't illegal". I'm certainly not arguing in favor of either of those positions.

It's not even remotely complex. Property was taken.
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