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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

#131

Post by s73v3r_ »

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.

Depends on if you feel that the crypto would continue to have value in the long term. If you've amassed that much power (or are close to it), and you didn't feel the coin was going to hold value long term, why not?

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

#132

Post by bronson »

drb91 wrote: post #74
gamblor956 wrote: post #57

Earlier quoted context omitted.

Bitcoin and other cryptocurrencies require even more trust than normal currency. With a normal currency transaction, you need only trust at most 2 other entities entities: your counterpart to the transaction and the government issuing the currency. With a blockchain, you still need to trust the counterparty, but now you also need to trust that the coders have properly designed and programmed the system, and that the…

I think there are fundamentally different ways we're talking about trust: you "only" need to trust a government, you "only" need to trust a bank, vs trusting a certain proportion of miners to be following the same bitcoin specs you are, as well as trusting that people will value it tomorrow. Both of bitcoin and government-issued currency requires trust, and building that trust is fundamentally difficult, depending on…

Let's not use HN as a place to enumerate cryptocoin variables? You can find plenty of that discussion elsewhere.

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

#133

Post by onecooldev24 »

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…

can you explain this in better words: "then it would always make sense to rent 51% of the capacity at market rates, earn the transaction fees, and also perform a double-spending attack."

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

#134

Post by [deleted] »

XR0CSWV3h3kZWg wrote: post #6

more details here: https://forum.bitcoingold.org/t/double-spend-attack-on-excha... Bitcoin gold was a fork to try and decentralize mining. It changed to a proof of work that is supposed to be ASIC resistant. It looks like the typical situation is mining by GPU for equihash (BTG PoW). BTG hashrate is at ~30MH/s at the moment, where Zcash's hashrate is at ~486MH/s. I don't have the numbers off hand, but it'd be interes…

[deleted]

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

#135

Post by onecooldev24 »

mehrdadn wrote: post #126
onecooldev24 wrote: post #105

Earlier quoted context omitted.

you can split the payment to multiple small amounts.

Confused... I thought the claim was about receiving and not sending?

if multiple accounts send multiple small payments (controlled by the same guy), then the exchange wont wait as long for the confirmations.

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

#136

Post by gamblor956 »

bufferoverflow wrote: post #66
Smaug123 wrote: post #24

Earlier quoted context omitted.

Those are both activities which use up trivial quantities of those natural resources. Bitcoin uses up nontrivial quantities of electricity.

You forgot to calculate how much (in resources) it costed to build all those banks and vaults and how much it costs to run and maintain, globally.

It probably cost a few billion dollars to build all those banks globally. It costs a few hundred million to maintain all those banks and vaults. However, these banks and vaults can handle more than 2000x the transactions of Bitcoin in a single day (Visa on its own is 750x the capacity of Bitcoin, and Mastercard handles about twice the number of transactions as Visa), so Bitcoin would need to be at least 1/2000th the price to build and maintain the network to maintain a comparative economic advantage against just those two companies. Including the entire financial system, Bitcoin would need to be somewhere in the neighborhood of 20,000x cheaper and more efficient.

And since we're taking into account all of the underlying systemic costs going into banks, we need to do the same for Bitcoin. That means including all of the power utilities, factories, and mining facilities that went into making the hardware, plus the cost of shipping the hardware worldwide, plus the cost of the utilities and transmission lines needed to operate the network. And that's clearly not 1/20,000th the cost or resource usage of our current financial system.

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

#137

Post by morogop »

dragonwriter wrote: post #90
drb91 wrote: post #36

Earlier quoted context omitted.

There's a hidden cost of trust there, though, which vanishes with bitcoin (or at least reduces its cost). Maybe the value of bitcoin is more apparent from the perspective of venezuela at the moment, where the risk involved with traditional banks, currency, and security is more apparent. I am emphatically not taking a stance on which I prefer here, I might add, just pointing out that there are more variables here than…

> There's a hidden cost of trust there, though, which vanishes with bitcoin With fiat, I at least have some idea who I am trusting, and if my trust is betrayed, I have some idea who to work with others to organize to work to inflict punishment. And, the people involved are aware of that. With crypto, I have to trust an anonymous network of people that I have only distant and indirect indications aren't, in overwhelmi…

in addition to the miners, you also have to trust a largely centralized group of software authors who make the key decisions.

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

#138

Post by onecooldev24 »

Taek wrote: post #118
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…

In the bitcoin system, miners make literally billions of dollars a year protecting the network. Any successful attack on the bitcoin network is going to massively erode confidence, reduce the price, reduce the usage, and therefore reduce the value of all that single-purpose, bitcoin-only hardware. Large miners don't want to see Bitcoin get attacked because it destroys their income and de-values their incredibly expen…

Top miners can short twice as many BTC futures to create one last profitable destruction.

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

#140

Post by vntok »

oh_sigh wrote: post #130
tehsauce wrote: post #110

Earlier quoted context omitted.

The spooky thing that this made me realize, is that if anyone did find a vulnerability in bitcoin (or any cryptocurrency) is that they would have a greater incentive to only slowly leech off the system, because they will be able to siphon out much more over time than if everyone panics over security. The weapon is no good unless it's secret.

Even finding a single double spend attack that only double-spends 1 satoshi would be enough to destroy bitcoin.

No it would not. Finding a BTC double spend attack vector would be like finding a 0-day: good and maybe even profitable up until fixed, which would take hours, days at most. Have 0-days destroyed Microsoft, Android, Firefox, Electron or Chrome?
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