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We can confirm that there was a successful 51% attack on Ethereum Classic

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Re: We can confirm that there was a successful 51% attack on Ethereum Classic

#41

Post by Cilvic »

johndunne wrote: post #30
leevlad wrote: post #27

Earlier quoted context omitted.

I think it's just not worth the time. What do you do when you've successfully run a 51% attack? You go on an exchange and double spend the money, which means you have to maintain the 51% attack for longer than min # of confirmations for this currency on said exchange. And even after that, most exchanges (in NA at least, can't say much about intl) require KYC.

Exactly, it's not worth the time. And once the attack is underway, it'll be detected and everyone can simply increase the number of confirmations needed before finalising.

How is the 51% attack detected?

Re: We can confirm that there was a successful 51% attack on Ethereum Classic

#42

Post by aaron_m04 »

viraptor wrote: post #14

An update from eth classic amount linked in that thread: (not sure what they mean by selfish mining...) Regarding the recent mining events. We may have an idea of where the hashrate came from. ASIC manufacturer Linzhi confirmed testing of new 1,400/Mh ethash machines #projectLavaSnow - Most likely selfish mining (Not 51% attack) - Double spends not detected (Miner dumped bocks)

So this is a publicity stunt intended to show off their mining rigs.

Re: We can confirm that there was a successful 51% attack on Ethereum Classic

#43

Post by CydeWeys »

semi-extrinsic wrote: post #22
johndunne wrote: post #7

This is inevitable. Ethereum Classic (ETC) isn't the only currency such attacks have been successful on. The site https://www.crypto51.app/ puts the cost of running a 51% attack on ETC at ~$5k per hour. The incentive for running these attacks for profit becomes higher as the market cap of these coins increases, making long-term 'investment' in these coins nonsensical.

How can there be coins with $5M+ market cap where the cost of a 51% attack is $3.00 ?? In an efficient market, thieves should just immediately attack that. Or is the benefit too low?

Because the market cap isn't truly $5M. That figure uses the naive calculation of "whatever coins sold for most recently times the total number of outstanding coins". But if you tried to sell some significant fraction of the outstanding coins then the sale price would plummet, and you'd never actually reach $5M total. The actual depth of the order book at any given moment isn't close to $5M, plus a lot of outstanding coins are completely lost and unredeemable.

The actual cost to take over a cryptocurrency tells you more valuable information than the naively calculated market map. If a cryptocurrency only costs $3/hr to take over then it's truly a shitcoin.

Re: We can confirm that there was a successful 51% attack on Ethereum Classic

#44

Post by sf_rob »

pietjepuk88 wrote: post #25
aetherspawn wrote: post #2

What does this mean? (Not all of us know a whole lot about how crypto works or why this is good or bad and what it means for our investments)

The most typical way to profit from this, is to have quite a bit of ETC, and then sell it on an exchange or buy something expensive. This transaction would then end up on the block chain, and eventually be considered secure / part of history. Privately, you are building a chain where said transaction did _not_ occur. Because your hash rate is high enough, you are generating blocks at at least the pace of the public c…

Upvoted for explaining the attack well but RE:longest chain, Blocks are added at a standard rate so the chain with the greatest accrued work is the "truth".

Re: We can confirm that there was a successful 51% attack on Ethereum Classic

#45

Post by CydeWeys »

orblivion wrote: post #11
bonyt wrote: post #8

Earlier quoted context omitted.

In this kind of blockchain network, the longest chain of blocks is considered to be the valid one. However, someone that has 51% of the hashing power (i.e. more hashing power than everyone else combined) can create a chain that grows faster than the chain used by everyone else. This means that they could tamper with their chain, potentially rewriting history on it, and because it is the longest chain, it will be acce…

Being only somewhat familiar, I wonder this: Why don't clients have a simple rule against accepting changes to history that are more than one or two blocks old?

Because then a simple accidental network partition could cause a permanent fork in the cryptocurrency.

Re: We can confirm that there was a successful 51% attack on Ethereum Classic

#46

Post by shaki-dora »

stcredzero wrote: post #17
hacker_9 wrote: post #3

Amazing, this blockchain technology really just keeps on giving. I have to say, it's quite entertaining to watch. It's pretty much a car crash happening in slow motion at this point. At least it provides something else to nerd joke about by the watercooler that isn't brexit for once.

I have to say, it's quite entertaining to watch. It's pretty much a car crash happening in slow motion at this point. At least it provides something else to nerd joke about by the watercooler... The above part pretty much applies to humanity as a whole, going back at least 200k years.

Yeah, except a good portion of the errors made in those 200k years at least had the excuse of being new.

Blockchain stands apart as repeating every single problem the financial system solved over the last 300 years, while being driven by a community best defined by their arrogant dismissal of that very financial system they are reinventing, piece-by-piece.

Turns out civil society (i. e. laws, courts, institutions, economics, shared fictions of value, and trust) cannot actually be replaced by an algorithm quiet as easily.

Re: We can confirm that there was a successful 51% attack on Ethereum Classic

#47

Post by CydeWeys »

Cilvic wrote: post #41
johndunne wrote: post #30

Earlier quoted context omitted.

Exactly, it's not worth the time. And once the attack is underway, it'll be detected and everyone can simply increase the number of confirmations needed before finalising.

How is the 51% attack detected?

It's really obvious once the new chain is broadcasted. "Honest" miners switch over to mine on the deepest chain as soon as they become aware of it. It's very rare to even see a 2-block conflict. When you see a large N-block conflict then it's obvious there's a 51% attack going on.

Re: We can confirm that there was a successful 51% attack on Ethereum Classic

#48

Post by pietjepuk88 »

naveen99 wrote: post #31
pietjepuk88 wrote: post #25

Earlier quoted context omitted.

The most typical way to profit from this, is to have quite a bit of ETC, and then sell it on an exchange or buy something expensive. This transaction would then end up on the block chain, and eventually be considered secure / part of history. Privately, you are building a chain where said transaction did _not_ occur. Because your hash rate is high enough, you are generating blocks at at least the pace of the public c…

so to be safe, an exchange should require more confirmations depending on size of deposit. Basically the number of confirmations you could finance an attack for with the deposit.

I'm not sure how easy it would be for exchanges to implement variable confirmations depending on the amount transferred, but I would say that what you suggest is a very reasonable way to limit the risk of suffering such an attack. I would say that especially exchanges that support fringe coins would better look into something like that. Even if the exchange's potential loss is only a couple hundred or thousand dollars, it's worth doing in my opinion, even if only to avoid the technical or legal hassle that would otherwise follow.

I would say that most (other) fringe coins are not as easily attacked as ETC was. They have very illiquid markets, and you cannot really sell a significant amount of them before you basically just deplete the order books. And merchants are typically not accepting anything other than the major coins either. I guess ETC was still riding along on its partially shared name/history with its bigger brother.

Eventually, some more details on the double spend transactions might shed some light on who suffered a loss in this case. It might be an exchange, but most of them require KYC nowadays (so it becomes hard to get away with).

Re: We can confirm that there was a successful 51% attack on Ethereum Classic

#49

Post by dragontamer »

johndunne wrote: post #7

This is inevitable. Ethereum Classic (ETC) isn't the only currency such attacks have been successful on. The site https://www.crypto51.app/ puts the cost of running a 51% attack on ETC at ~$5k per hour. The incentive for running these attacks for profit becomes higher as the market cap of these coins increases, making long-term 'investment' in these coins nonsensical.

> The incentive for running these attacks for profit becomes higher as the market cap of these coins increases, making long-term 'investment' in these coins nonsensical.

I disagree that market cap is the primary indicator. Note that market cap (or really, price of ETC on major exchanges) has dropped dramatically in the past 3 to 6 months. So Market Cap / Price of ETC is a minor factor.

In contrast: the ABSOLUTE COST of a 51% attack drops each time the difficulty drops. That's what I personally think is the main contributor here, because the market-caps of all coins have dropped dramatically the past few months.

In effect: its not so much that the potential profit out of a hypothetical 51% has gone up (it hasn't: Ethereum Classic is way cheaper than it used to be). Its that the DIFFICULTY of ETC has dropped dramatically, finally making the 51% profitable.

Re: We can confirm that there was a successful 51% attack on Ethereum Classic

#50

Post by jeremyjh »

Klathmon wrote: post #39
naveen99 wrote: post #31

Earlier quoted context omitted.

so to be safe, an exchange should require more confirmations depending on size of deposit. Basically the number of confirmations you could finance an attack for with the deposit.

Yes, and most do. Many will semi-routinely increase the number of confirmations during times where it could be necessary (like chain splits or network upgrade events), or adjust the number of confirmations depending on the size of the currency and overall usage. Another mitigation is to shut down trading until the attack is over. Maintaining a 51% attack is expensive (assuming there is at least SOME usage of the coin…

The attack cannot be observed until it is accomplished. Naturally the chain will be long enough to target the exchange the spend was made at.
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