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Bitcoin's Security Budget Issue: Problems, Solutions and Myths Debunked

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Re: Bitcoin's Security Budget Issue: Problems, Solutions and Myths Debunked

#31

Post by olalonde »

osigurdson wrote: post #25
gruez wrote: post #11

Earlier quoted context omitted.

I see your ChatGPT generated argument and raise you my DeepSeek generated rebuttal: 1. The $4B "Cost" Is Fundamentally Misinterpreted: * It's Not a "Cost" Like Buying an Asset: The $4B figure (if accurate) typically refers to the theoretical short-term cost to rent sufficient hashrate to perform a temporary attack. This does not mean you can "buy" control of Bitcoin for $4B. * Acquisition Cost vs. Rental Cost: Actual…

I guess in reality you would just pressure the big miners since the top 4 control 80%. Nuts.

Where is that figure from? You're probably looking at mining pools, which don't actually own the hardware - individual miners do. A pool is just a service that coordinates many miners to work together and split the rewards. If a pool tried to behave maliciously, miners would simply switch to another pool and the pool would quickly lose its hashrate.

Re: Bitcoin's Security Budget Issue: Problems, Solutions and Myths Debunked

#32

Post by olalonde »

jowea wrote: post #29
olalonde wrote: post #7

Earlier quoted context omitted.

First, that figure is way off. Marathon alone has a market cap over $4B and controls less than 5% of the total hash rate. Second, the system only seems vulnerable if you ignore economic incentives. A 51% attack isn't just technically difficult - it's economically irrational. Pulling it off would cost billions, and even then, there's no clear way to profit from it. The only scenario where it makes sense is a non-econo…

If we're talking about a fork, couldn't a fork just ignore the attack? The normal miners aren't forced to use the attacker's blocks after all.

The problem is that there's no reliable way to identify who mined a given block, so you can't simply have the network "ignore blocks from the attacker." The coinbase transaction may contain identifying info (e.g., pool name) but it's not mandatory nor authenticated.

Re: Bitcoin's Security Budget Issue: Problems, Solutions and Myths Debunked

#33

Post by beeflet »

coolKid721 wrote: post #24

Lol total garbage people have been whining about the blocks regularly being EMPTY now, a huge % of transactions just occur off chain on exchanges/lightning/etc. There are no 100 dollar fees you can basically do everything for basically free. https://mempool.space/ look, you can see how many blocks aren't filled lol. This piece is literally just garbage. Big blockers are scam artists.

On the lightning network, fees are distributed to rent-seeking intermediaries instead of miners, yet the network is still dependent on the security from the miners. The lightning network is parasitic to bitcoin.

Blocks are empty because people decided that bitcoin was not a feasible means of transaction nearly a decade ago during the blocksize war.

Re: Bitcoin's Security Budget Issue: Problems, Solutions and Myths Debunked

#34

Post by charcircuit »

I think switching to something like proof of stake where bad actors can be punished is the best way forward to avoid honest nodes betraying the network.

Trying to maximize mining profit is adversarial with the end users and makes using bitcoin unattractive.

Re: Bitcoin's Security Budget Issue: Problems, Solutions and Myths Debunked

#35

Post by ozgrakkurt »

gruez wrote: post #11
osigurdson wrote: post #2

According to ChatGPT, Bitcoin market cap is $2T while the cost to carry out a 51% attack is $4B. If correct, it seems a little imbalanced.

I see your ChatGPT generated argument and raise you my DeepSeek generated rebuttal: 1. The $4B "Cost" Is Fundamentally Misinterpreted: * It's Not a "Cost" Like Buying an Asset: The $4B figure (if accurate) typically refers to the theoretical short-term cost to rent sufficient hashrate to perform a temporary attack. This does not mean you can "buy" control of Bitcoin for $4B. * Acquisition Cost vs. Rental Cost: Actual…

No one got time to read 15 paragraphs of AI slop

Re: Bitcoin's Security Budget Issue: Problems, Solutions and Myths Debunked

#36

Post by daveguy »

olalonde wrote: post #7
osigurdson wrote: post #2

According to ChatGPT, Bitcoin market cap is $2T while the cost to carry out a 51% attack is $4B. If correct, it seems a little imbalanced.

First, that figure is way off. Marathon alone has a market cap over $4B and controls less than 5% of the total hash rate. Second, the system only seems vulnerable if you ignore economic incentives. A 51% attack isn't just technically difficult - it's economically irrational. Pulling it off would cost billions, and even then, there's no clear way to profit from it. The only scenario where it makes sense is a non-econo…

Why would someone want a random block chain company to own 5% of the possibility of destroying their holdings? What if the company gets co-opted by some nation state actor? Bitcoin really seems like a terrible place to keep wealth.

Re: Bitcoin's Security Budget Issue: Problems, Solutions and Myths Debunked

#37

Post by beeflet »

lagniappe wrote: post #22
doublextremevil wrote: post #15

The whole point of restricting the block size was to ensure space in the blockchain was scarce to drive the price of fees up, better securing the network. Well, that and keeping the blockchain total size small enough to be processed on an regular user's PC for decentralization sake. While a loss of some decentralization is non-ideal, increasing the block size dynamically, similarly to how difficulty is handled, would…

Monero does dynamic block size. It works fine. There is a penalty for large swings in size and that controls the fee which allows the fee to be appropriate during swells and luls in volume.

Something I would like to see from the cryptocurrency space is some way for the block size to fluctuate with daily and weekly transaction volume. For example, you would expect that the transaction volume would be greater when it is daytime on the east coast, so the blocksize should adapt to those temporal changes as well.

If there is a certain latentcy/bandwidth/storage/decentralization tradeoff with block sizes, then we ought to design cryptocurrencies to make the most of this tradeoff with respect to predictable low/high demand.

Re: Bitcoin's Security Budget Issue: Problems, Solutions and Myths Debunked

#38

Post by wmf »

daveguy wrote: post #36
olalonde wrote: post #7

Earlier quoted context omitted.

First, that figure is way off. Marathon alone has a market cap over $4B and controls less than 5% of the total hash rate. Second, the system only seems vulnerable if you ignore economic incentives. A 51% attack isn't just technically difficult - it's economically irrational. Pulling it off would cost billions, and even then, there's no clear way to profit from it. The only scenario where it makes sense is a non-econo…

Why would someone want a random block chain company to own 5% of the possibility of destroying their holdings? What if the company gets co-opted by some nation state actor? Bitcoin really seems like a terrible place to keep wealth.

If you own 5% of the hash rate you have ~0% ability to attack the network.

Re: Bitcoin's Security Budget Issue: Problems, Solutions and Myths Debunked

#39

Post by beeflet »

desumeku wrote: post #14
827a wrote: post #10

Wow, its almost like deflationary currency isn't a good idea. Who would have thought? Certainly, uh, most economists.

This article has nothing to do with the inflationary or deflationary nature of the currency, this is a problem solely caused by the block size limit, which other cryptocurrencies are free from and don't worry about.

There are more inflationary emission schedules which are safer, and don't rely so much on transaction fees to subsidize mining. For example, look at the constant tail emission used by dogecoin and monero.

Re: Bitcoin's Security Budget Issue: Problems, Solutions and Myths Debunked

#40

Post by yieldcrv »

doublextremevil wrote: post #15

The whole point of restricting the block size was to ensure space in the blockchain was scarce to drive the price of fees up, better securing the network. Well, that and keeping the blockchain total size small enough to be processed on an regular user's PC for decentralization sake. While a loss of some decentralization is non-ideal, increasing the block size dynamically, similarly to how difficulty is handled, would…

Bitcoin: lets make it so a medium grade computer and internet connection by 2008’s midrange standards works. Forever.

Solana: let’s make it so that enthusiast grade computers and internet connectivity by 2024’s high range standard works. Sometimes. But keep pushing.

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