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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

#181

Post by [deleted] »

labster wrote: post #175
dragontamer wrote: post #128

Earlier quoted context omitted.

51% attackers mine in secret. Basically, you spend your coins today, while controlling a 51% share. When everyone else's 49% hash-power creates 98 blocks, your 51% share will create 102 blocks. But secretly. That's the key. Now that your chain is +4 ahead (or wait even longer and become +10 ahead), you can spend your coins on the public chain. Then, you publish your 102 alternative blocks (which barely adds any hash…

If only we had a currency that was immune to 51% attacks because a government was willing to use force to preserve its value, and therefore doesn't need a massive use of energy for its proof of work.

[deleted]

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

#182

Post by thaumasiotes »

perl4ever wrote: post #146
vkou wrote: post #63

Earlier quoted context omitted.

No, this is precisely why trying to calculate the market cap of a crypto-currency is pointless. A company is a productive enterprise, that produces value for you, if you sit on shares of it. Something like bitcoin is a purely speculative instrument, that produces no value if you sit on it. The market cap for a company is an imprecise proxy for all expected revenues, discounted by time[1]. The market cap for a currenc…

It is correct to say that the market cap of a company is not the amount you can buy the company for. Most of the owners of shares in any company aren't ready to sell for the market price. That is the salient parallel being drawn.

That's not a good parallel. The market capitalization of a company is more than you could sell the company for. It's less than you'd have to pay to buy the company.

But in this hypothetical attack, the complaint is that the "market capitalization" is more than you'd have to pay to buy out the network.

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

#183

Post by oblio »

stickfigure wrote: post #172
nickpsecurity wrote: post #137

Earlier quoted context omitted.

The thing I was getting at is, if you had a computer and Internet, then email would be a free, fast alternative to traditional mail. That has obvious benefit. Whereas, these currencies are volatile, slower, often dont allow charge backs, use more energy, and accepted at fewer places. Worse in every way to checking accounts and credit cards. Esp if we have multiple cards or accounts to reduce risk of single institutio…

Worse in every way to checking accounts and credit cards. Quite a few Venezuelans would beg to differ about that.

So for cryptocurrencies to be the "better solution" you just need your entire country to have a total meltdown lasting multiple years?

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

#184

Post by thaumasiotes »

CydeWeys wrote: post #78
chrisseaton wrote: post #76

Earlier quoted context omitted.

> 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". Isn't that literally the definition of market capitalisation?

What works for companies doesn't work for cryptocurrencies. Companies have actual assets and cash flows, while cryptos do not. Companies are routinely acquired for a bonus above the total market cap (a premium on the share price times all shares outstanding). The same would never happen for cryptos. A better analogy would be to calculate the "market cap" of gold.

> What works for companies doesn't work for cryptocurrencies. Companies have actual assets and cash flows, while cryptos do not.

This isn't actually relevant. Calculating market cap based on current trading price is equally valid for company stocks and cryptocurrencies. The divide is not between "companies" for which market capitalization is good and "cryptocurrencies" for which market capitalization is misleading, it is between objects for which the market capitalization is a reliable guide to the object's value and other objects for which it isn't.

You can judge the reliability of a market capitalization figure by looking at the trading volume of the object. If something has a market capitalization of $10,000,000 and sees $40,000 of trade per day, then you can reliably trade at the value reflected by the $10,000,000 market cap figure as long as the amount you're trading isn't significant compared to the background trading volume of $40,000 per day. If you try to trade $60,000 "worth" of whatevers, you'll crash or spike the price with your 150% increase in trading volume.

If something else has a $10,000,000,000 market cap and $40,000 of trade per day, then... you can trade at the value reflected by the market cap as long as you don't have a significant impact on the background trading volume of $40,000 per day. It doesn't matter that the market cap is a thousand times higher; it doesn't matter whether one of the things is company stock and the other thing is a cryptocurrency; what matters is whether you disturbed the normal trading volume, whatever that volume was.

Note that penny stocks see wild, spurious swings in their market capitalization all the time. That is because of their low trading volumes. It's not because Apple is a company and Shifty Joe's Investment Scam LLC isn't -- they're both companies.

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

#185

Post by KKKKkkkk1 »

labster wrote: post #175
dragontamer wrote: post #128

Earlier quoted context omitted.

51% attackers mine in secret. Basically, you spend your coins today, while controlling a 51% share. When everyone else's 49% hash-power creates 98 blocks, your 51% share will create 102 blocks. But secretly. That's the key. Now that your chain is +4 ahead (or wait even longer and become +10 ahead), you can spend your coins on the public chain. Then, you publish your 102 alternative blocks (which barely adds any hash…

If only we had a currency that was immune to 51% attacks because a government was willing to use force to preserve its value, and therefore doesn't need a massive use of energy for its proof of work.

When a president tells the governor of the central bank not to raise interest rates despite the bank board's best professional judgement, is that considered an attack?

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

#186

Post by garmaine »

drb91 wrote: post #173
garmaine wrote: post #113

Earlier quoted context omitted.

Proof of Stake is a perpetual motion machine. You can't safely tie consensus to something (stake) which is determined by consensus. That's circular reasoning and ungrounded.

What would failure look like?

A system that has effectively bifurcated with conflicting chain tips caused by rewriting history with new nodes unable to tell which is original, or a fully centralized stake-mining where a subset of stake voters game the system to unfairly select themselves out of proportion of their stake weight.

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

#187

Post by arcticbull »

KKKKkkkk1 wrote: post #185
labster wrote: post #175

Earlier quoted context omitted.

If only we had a currency that was immune to 51% attacks because a government was willing to use force to preserve its value, and therefore doesn't need a massive use of energy for its proof of work.

When a president tells the governor of the central bank not to raise interest rates despite the bank board's best professional judgement, is that considered an attack?

And then the governor of the central bank doesn't because they don't take their orders from the executive branch, because they're a private entity? That's actually the whole reason they're a private entity -- to separate monetary policy from politics. Them being a private entity was what Satoshi was mad about, and yet here it is, saving our asses. What if Satoshi was ... wrong about everything?

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

#188

Post by speakeron »

thaumasiotes wrote: post #179
jancsika wrote: post #108

Earlier quoted context omitted.

Imagine all the Bitcoin miners out there right now using their ASICs to do extremely efficient hashing in the hopes of generating a block reward. Let's didactically suppose there are 100 such miners total. Now imagine Dinkycoin comes along and releases their cryptocurrency that uses the same hashing mechanism for the block reward. Initially they have the block difficulty level pretty low as there aren't that many peo…

> suppose Dinkycoin says you need 20 confirmations before accepting that a transaction "went through." > Once the Bitcoin miner has a competing branch with greater total difficulty than the rest of the network, the network must accept that branch as the winner. These statements directly contradict each other. The very, very obvious solution is to say that, if 20 confirmations validate that a transaction happened, the…

> These statements directly contradict each other.

They don't contradict each other at all.

> Once block 26 comes online, block 6 is a permanent feature of the blockchain.

What defines the 'blockchain'? It's the chain with the most work. Outside of a centralized checkpointing mechanism, the only definition of the valid blockchain is the one with the most work behind it.

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

#190

Post by thaumasiotes »

speakeron wrote: post #188
thaumasiotes wrote: post #179

Earlier quoted context omitted.

> suppose Dinkycoin says you need 20 confirmations before accepting that a transaction "went through." > Once the Bitcoin miner has a competing branch with greater total difficulty than the rest of the network, the network must accept that branch as the winner. These statements directly contradict each other. The very, very obvious solution is to say that, if 20 confirmations validate that a transaction happened, the…

> These statements directly contradict each other. They don't contradict each other at all. > Once block 26 comes online, block 6 is a permanent feature of the blockchain. What defines the 'blockchain'? It's the chain with the most work. Outside of a centralized checkpointing mechanism, the only definition of the valid blockchain is the one with the most work behind it.

>> These statements directly contradict each other.

> They don't contradict each other at all.

They do; for a transaction to be revocable means you haven't accepted that it went through. If every block is revocable indefinitely, then you can't say that 20 confirmations confirm a block, because they don't.

> What defines the 'blockchain'? It's the chain with the most work.

No, it's the chain accepted by a group of miners. Miners are the sole authority of a bitcoin-style blockchain. Work is not.

> Outside of a centralized checkpointing mechanism, the only definition of the valid blockchain is the one with the most work behind it.

Centralization is not necessary for this. As a miner, you're free, in your individual capacity, to reject blockchain candidates that invalidate blocks you consider permanent. Centralization would mean that a block could require only 0 following blocks before being considered permanent. With a consensus of decentralized, less-than-perfectly-synchronized miners, you'd want a fuzzier boundary -- which is what "wait for 20 following transactions" provides.

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