Bitcoin Gold Hit By 51 Percent Attacks, $72,000 In Cryptocurrency Double-Spent 119
Malicious cryptocurrency miners took control of Bitcoin Gold's blockchain recently to double-spend $72,000 worth of BTG. The Next Web reports: Bad actors assumed a majority of the network's processing power (hash rate) to re-organize the blockchain twice between Thursday and Friday last week: the first netted attackers 1,900 BTG ($19,000), and the second roughly 5,267 BTG ($53,000). Cryptocurrency developer James Lovejoy estimates the miners spent just $1,200 to perform each of the attacks, based on prices from hash rate marketplace NiceHash. This marks the second and third times Bitcoin Gold has suffered such incidents in two years.
Any entity that controls more than 51 percent of a blockchain's hash rate can decide what version of the blockchain is accepted (or rejected) by the network. These scenarios also allow for "double-spending," attacks that initiate a transaction with intent to quickly reverse it by "re-organizing" the blockchain, so that they can spend their original cryptocurrency again. What results is a third party accepting the original transaction and the network returns the cryptocurrency spent to the attacker, essentially allowing their funds to be used twice -- hence the name "double-spending." With Bitcoin, a transaction is generally deemed legitimate once found six blocks deep in the blockchain. These particular 51-percent attackers performed re-organizations up to 16 blocks deep, seemingly in a bid to trick exchanges like Binance into paying out BTG destined to be double-spent.
Any entity that controls more than 51 percent of a blockchain's hash rate can decide what version of the blockchain is accepted (or rejected) by the network. These scenarios also allow for "double-spending," attacks that initiate a transaction with intent to quickly reverse it by "re-organizing" the blockchain, so that they can spend their original cryptocurrency again. What results is a third party accepting the original transaction and the network returns the cryptocurrency spent to the attacker, essentially allowing their funds to be used twice -- hence the name "double-spending." With Bitcoin, a transaction is generally deemed legitimate once found six blocks deep in the blockchain. These particular 51-percent attackers performed re-organizations up to 16 blocks deep, seemingly in a bid to trick exchanges like Binance into paying out BTG destined to be double-spent.
Shocked I am! (Score:1, Troll)
It is of not belief that currency of piracy is pirated!
Much expression!
Double plus ungood - must complain to N Korea and Russia
"Bitcoin Gold" (Score:2, Insightful)
Re: "Bitcoin Gold" (Score:1)
Greed not as good as promised (Score:4, Interesting)
That was a much cheaper attack than I would have expected.
From TFA:
Cryptocurrency developer James Lovejoy estimates the miners spent just $1,200 to perform each of the attacks, based on prices from hash rate marketplace NiceHash.
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Yes, I noticed that myself, now the question is ...
Is it a crime?
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Wouldn't it be fraud if you knowingly spend it twice? Might be hard to prove though.
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Wouldn't it be fraud if you knowingly spend it twice?
No. The only "rules" are the code itself. Any other set of "rules" would require a central authority, which doesn't exist.
If the code allows coins to be spent twice with 51% approval, then that is how the system works. No rules were broken, so no fraud was committed.
If you bought BTGs without reading the code and understanding what you were buying, then that is your problem.
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Wouldn't it be fraud if you knowingly spend it twice?
No. The only "rules" are the code itself. Any other set of "rules" would require a central authority, which doesn't exist.
Maybe. Even though much of the point of cryptocoins is to break free of the governmental system of controls, it still exists. Odds are that all of this crosses jurisdictions in a way that would make it very difficult to prosecute, and the lack of any written contracts would create additional complications, but if the jurisdictional question is surmountable, judges are often quite good at cutting through all of that to find a fair judgement based on the expectations of all involved.
It's not impossible tha
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That would be a fun case. Most fraud laws refer to some kind of gain, not just monetary. But massive fraud takes place in games, for virtual items that are exchangeable for real items, or for real money in, for example, poker.
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It's a contract, perhaps only verbal but still a contract. Lets say I trade a car to you for a bitcoin, that means we agree the bitcoin is worth a car. If you are planning on shortly making that bitcoin worthless, you've fraudulently made a transaction. It's similar to paying me with a check and then quickly removing the funds to cover the check, fraud.
As swilden points out, things like jurisdiction and lack of a written contract might make it impossible to prosecute, but it still seems to be fraud.
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It's a contract, perhaps only verbal but still a contract. Lets say I trade a car to you for a bitcoin, that means we agree the bitcoin is worth a car. If you are planning on shortly making that bitcoin worthless, you've fraudulently made a transaction.
What if the person decides the car is only worth a cent? Seeing as you have agreed the car and the bitcoin are the value, is destroying the value of the bitcoin, which is literally just a number, fraud?
It's similar to paying me with a check and then quickly removing the funds to cover the check, fraud..
No, because the the check has a value set by a third party, the government of the nation issuing the currency that the check represents. Bitcoins, being nothing but a number backed by nothing and issued by no one, has no set value.
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At least here, when transferring a vehicle, the worth has to be declared and sales tax paid. In the case where the declared worth is much different then the book price, other forms need filling out, so the transfer papers should show the agreed upon worth.
Even currency's value is set by the market, though the government will manipulate the market by buying/selling currency and setting interest rates, what it comes down to is what you can trade currency for.
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and more to the point, if BTC is designed to avoid any interaction or surveillance by the government, good luck getting someone to care about redress.
If you deliberately pay no taxes, the government will not be too bothered to send cops or financial regulators to help you out when you need them.
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You appear to love systems where the lack of rules allows people to be screwed over without consequences to the con artist. Do you feel that inferior people are the natural prey of superior people?
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Yes,
This is a valuable lesson to many, I look forward to the person that is creating the concept of a 51% attack on bitcoin or another highly liquid target.
if the cost vrs results ( using slightly off numbers) $3000 start up to get $70,000 gross, You could easily scale that and just park the coins, the next seemingly feasible attack would be Monero https://bitinfocharts.com/comp... [bitinfocharts.com] because it's hashrate does not seem to be that far off from being able to do it ( 100 times more hashing power ) and liquidi
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But these "inferior" people can and do band together, to limit the power the "superior" people have over them. This in fact means the so-called inferior people are superior. So by your own logic, the weak who band together should dominate the wrongly labelled "strong." Typically, this is done through something we call "government" that lets the common person engage in collective decision making. This process creates things called "laws" which regulate behavior. The people who engage in this activity, common
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Nice dissertation,
but this is what I expect with UID as low as yours. ( not throwing shade, just stating a factual observation )
the public benefit of a decently structured republic show that the inferior have the chance to become superior, and the the superior get to have a gain from the inferior subject to taxation.
basically a better regulated biology. sometimes it catches a cold but it works to go forward and have a decent life.
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Nah, because of the ound power problem. Let's assume we start with a real meritocracy. Assume merit is rewarded with money. Let's also assume we allow low taxed gifts or inheritance. Well, money is power. And enough power lets you shift what is called "merit." Merit becomes "whatever I or my offspring do" and whatever I don't do, is not meritorious or deserving of reward. Soon, the meritocracy is no more and we have an inheritable aristocracy instead. That's where we are right now.
The problem is that the su
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Oops, "Compound power problem," like compound interest.
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personally,
I liked the thought of a 40% asset tax if you die as a 1% or above ( a number published weekly by the IRS )
this way you force the 1% to spend money so they don't become the 1%.
yes they will find loopholes but they will spend a shit load still.
yes, they will buy the latest and greatest toys, and most likely harm the environment along the way with whatever harms the environment. I'm thinking so something like a true live version of "battleship" done with parked yachts and 1 rented battleships, that
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Not 1 percent. .01 Percent. The billionaires, not the millionaires. Millionaires are a dime a dozen these days, it's not an excessive amount of wealth. tens of millions should get you a 10% transfer tax, hundreds should get you 20%. Or so, these are just spitballing some numbers, but the 1% aren't really the problem. It's just a catchier phrase than "the .01 percent."
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good observation, .01% bracket at death is important for inheritance.
it's been noted that in California, the top 200 tax payers make up 35% to 44% of the budget depending on the bonus and stock options.
so I can see that the fight not to be in the
but I am sticking to the 40%, just has to be painful just to the point of reasonable. historically speaking in the 30's and 40's we had tax rates exceeding 65% on income. sure as heck we can take lot's of those billions and place it into better transport
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Is it a crime?
It's probably the logical equivalent of someone writing a bad check for $72,000.00, only the crime itself is technologically much more sophisticated. While writing a bad check might be argued in court to be an impulse decision, this crime was definitely premeditated.
The question I have is would any judge presiding the case have a complete grasp of how this crime was actually pulled off. We probably need laws written to specifically deal with this kind of crime, as the existing laws are likely inadiquate
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That was a much cheaper attack than I would have expected.
From TFA:
Cryptocurrency developer James Lovejoy estimates the miners spent just $1,200 to perform each of the attacks, based on prices from hash rate marketplace NiceHash.
Yeah, imagine, it only takes $1,200 worth of GPUs to take over 51% of the bitcoin network.
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https://www.crypto51.app/ [crypto51.app]
More than $1200, less than $1 mil. The fact that you could 51% bitcoin for a modest amount suggests that the $162 billion market cap is bullshit.
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Yeah, imagine, it only takes $1,200 worth of GPUs to take over 51% of the bitcoin network.
No, it takes $1200 to take over 51% of the bitcoin GOLD network.
It is a 751:1 exchange rate between bitcoin and bitcoin gold. It would cost just over $900,000 for the same amount of bitcoin, and they would need hundreds of those $900k purchases to reach 51% as the BTC network has far more miners than BTG.
It would be well over $10 million USD in BTC plus the mining hardware and electricity to perform the same attack with actual bitcoin.
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The potential payout from that kind of theft, ZERO, you basically parasite the coin to death. What is bitcoin worth without the illusion of security, ZERO, it in reality was always just a marketing delusion, zero worth, in fact technically, negative worth, considering the capital required to generate it. So how much real world money can you steal via this method, not much really, the more you steal, the rapidly it becomes worth, ZERO.
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Such an attack would probably be a one time thing by an actor who then cashes out. Whoever does such a thing is not going to be interested in the long term viability, they would probably just be some large investor or any sized state that sees an opportunity. I would not be surprised if there were already groups debating when, if ever, to try such a thing, and reading the tea leaves about what future payoffs might look like if they wait.
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The point of a double spending attack is that you *spend* the coin immediately. The blockchain communities are more than capable of reversing bad transactions so you want to dump that coin as quickly as possible for real currency.
You are absolutely taking both your ill gotten gains and a bunch of confidence out of the value of the coin, but other people are left holding that bag.
Plenty of opportunity to make cash (Score:2)
If you can destroy the value of a traded investment you can probably make lots of money. Bitcoin has every sort of nutty derivative you can possibly imagine so if you can force it to your will in any manner there is a good chance you can make money.
If you could dependably topple the whole house of cards in a given time frame you could make a mint.
BTC is vulnerable, too centralized (Score:2)
... and they would need hundreds of those $900k purchases to reach 51% as the BTC network has far more miners than BTG ...
Unless they are the government of the legal jurisdiction where 65% of those miners are located, miners dependent upon cheap government supplied electricity, miners that are commercially oriented in nature.
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BTC is not vulnerable - BTC is decentralized (Score:2)
At the mining level; The only theoretical attack is the 51% one. This is beyond countries capability at this stage.
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The decentralization is the concept allowing the absence of 'Single point of failure'.
In theory, but in reality we **do not have** decentralization. I did not say the original theoretical security model itself is broken. I said BTC has deviated from it, lost decentralization, and therefore BTC has a broken security model.
... This is beyond countries capability at this stage.
No, "beyond countries capability in theory". In reality BTC has deviated from its underlying requirements and assumptions and is in fact vulnerable. Again, 65% of miner in China dependent upon cheap government supplied electricity. Plus these are largely commercial operatio
The real bitcoin, not gold, has broken security... (Score:2)
Yeah, imagine, it only takes $1,200 worth of GPUs to take over 51% of the bitcoin network.
It costs one nation nothing to take over 65% of the real bitcoin network. This government controls the electricity for 65% of the miners.
The real bitcoin has deviated from its security model. It was supposed to have a diverse decentralized network of miners, miners that maintain the blockchain, miners that are ordinary people spread around the globe who are using their own computers. Such a population of miners would be beyond the control of any one government.
However this is not what we have. Mining
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No, that security
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ASIC resistant proof of work algorithms (Score:2)
GPUs, that's consumer grade so they are perfectly fine in the original security models assumptions. You can get diversity
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Even cryptocurrency fraud is a hyper-inflated bubble. Seriously, $1200 in, and you get to 60x your investment?
So much for 'secure', LOL. (Score:2, Insightful)
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Bitcoin Gold vs Bitcoin
is like
Java Script vs Java
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BTC is not vulnerable (Score:2)
No, BTC is not vulnerable. The hashrate is a huge number; You can't manufacture the equipment, and at the same time, get the Switzerland electrical power or more, to get everything running.
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Call him Winnie the Pooh again [wikipedia.org]. He dares you [thenextweb.com].
Re: BTC is not vulnerable (Score:1)
If they forced an inappropriate change, it would. Be quickly discovered, word would get out 5 seconds later and BTC value would drop to zero.
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https://www.crypto51.app/ [crypto51.app]
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The wheels are coming off the cryptocurrency bus aren't they?
The promised fix is going to be to replace the current octagonal wheels with ten-sided wheels.
Shut up and (Score:2)
"Shut up and take my money!"
Oh, wait...you already did.
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Take it again!
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Take it again!
Shit. My mod points expired 5 minutes ago. That was brilliant.
What is Bitcoin "Gold"? (Score:3)
Re:What is Bitcoin "Gold"? (Score:5, Insightful)
It looks suspiciously like someone went down the list and picked the crypto currency with the highest "market cap" that had a disproportionately small attack cost. https://www.crypto51.app/ [crypto51.app]
transfer all bitcoins to a single wallet (Score:2)
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I think you underestimate how many "Jokers" there are in this world, who would love to see it burn. The amount of money used to obtain this end would be utterly irrelevant. You're deluding yourself.
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Re: transfer all bitcoins to a single wallet (Score:2)
For this one, someone spent $1200 on computing power
Or someone had $1200 of idle capacity. Or someone hijacked $1200 of capacity. Or suckered a bunch of people into contributing a sum total of $1200.
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Except you can't short that much. The majority of bitcoin's "value" is created by meaningless transactions among large holders. You'd never find anyone to take your billion dollar short.
You could probably pull out a few million using the same double spending technique, giving a pretty good ROI on the $800k or so it would take to 51% bitcoin though.
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You're kind of taking Slashdot literalism to the extreme.
https://en.wikipedia.org/wiki/... [wikipedia.org]
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Nobody wants to do that because it will render all bitcoins stolen, and end it forever, and set back all blockchain uses by decades.
I see your definition of "Nobody", includes people who don't own any bitcoin, people who want to destroy bitcoin, and people who just want to watch bitcoin burn for the fun of watching all blockchain users for the fun of it.
Don't use "Bitcoin Gold" (Score:4, Insightful)
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Bitcoin Gold is a fork of the original Bitcoin. Don't use it unless you know what you're doing.
I think you can leave off the "unless you know what you're doing" part. Unless what you mean by that is controlling 51% of the mining so you can double spend money.
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s/ unless.*/./
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Kind of like the group that made money off lotto (Score:2)
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IIRC, There was a consortium of already wealthy people from Australia who kept track of jackpot sizes in some of the lotteries. When the jackpot was big enough they could reasonably purchase all combinations and guarantee a winner. Since the outlay was large, the return was probably just double their money as opposed to the millions of times return that average players are aiming for. Of course, when you've already got $100 million, doubling that is a tasty proposition. I think the lotteries have found
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I think the lotteries have found ways to prevent this
By having more combinations so that it's not possible to "buy them all". Try buying up the US "Powerball" lotto. That will be $584 million please...
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IIRC, There was a consortium of already wealthy people from Australia who kept track of jackpot sizes in some of the lotteries. When the jackpot was big enough they could reasonably purchase all combinations and guarantee a winner.
I think you're thinking of Stefan Mandel.
Originally from Soviet Romania before moving to Australia.
And then applied the same scheme to the Virginia lottery.
https://allthatsinteresting.co... [allthatsinteresting.com]
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Why would lotteries want to prevent it? It's just more money for them.
It's pretty trivial to compute when the jackpot in a lottery gets big enough to make the expected payout positive. Not many people play the game though because it usually requires a massive investment, and it *isn't* a sure thing. The number can still come up with a combination you didn't buy or some dweeb could randomly buy the winning number in a gas station in the middle of nowhere and you have to share the payout.
They never learn (Score:2)
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The problem is there are genuine use cases beyond crime or tax evasion for a cryptocurrency. Some are higher priority than others, but it fills a need.
Unfortunately, crime and tax evasion seem to dominate the activity.
Newflash: Bitcoin is flawed (Score:2)
Video at 11. Recriminations updated recursively.
Re: Bitcoin has zero 'Single point of failure' (Score:2)
Tough to spend physical gold twice... All the other means of conveyance have similar vulnerabilities, but Bitcoin has one that seems insurmountable. 51 attacks are going to keep happening. It's over until these are mitigated.
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Physical gold was double (or more) spent lots of times. So much so that modern(ish) banking was invented by a militant Christian cult to address the problem.
See, you spend the gold, then you pull out a knife, take the gold back, then spend it again. Even easier, if you don't have any gold, you can just find someone who does and skip the first step.
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Ok, so it's all theft.
You're leaning towards libertarianism, right?
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Ha ha, quite the opposite. The typical Slashdotter probably considers me an irredeemable communist.
I was just pointing out that "physical gold" isn't the panacea people (uh, libertarians mostly?) seem to think it is. It's got the same issues as any currency to greater or lesser degree. Gold is heavy, obvious and a pain in the ass to transport, which is why the Knights Templar did so well with their banking system. But, it's a pain in the ass to transport so if your goal is to hold onto it, you just need som
Other than being centralized vulnerable to gov (Score:2)
Bitcoin has zero 'Single point of failure'
Other than the reality of bitcoin mining deviating from the design requirement of a diverse decentralized population of miners using their own computers. The reality today is the mining is done with specialized ASIC hardware, the owners/operators of this hardware are overwhelmingly commercial in nature, and 65% of them are within the borders of a single nation and dependent upon cheap government supplied electricity. That nation can dictate blockchain alterations. Is this likely, no, but the original securi
Bitcoin has zero 'Single point of failure' (Score:2)
At the mining level; The only theoretical attack is the 51% one. This is beyond countries capability at this st
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A country may try. It will be out-competed by the free market. Bitcoin is hard money, a very good incentive to own it, and to protect it. A country trying this, will just get broke at this end.
There is no free market when 65% of all bitcoin miners are located in China and dependent upon inexpensive government supplied electricity. Bitcoin mining is centralized and vulnerable to government intervention. The Chinese Communist Party will not go broke going to the commercial mining farms and telling them to coordinate to make a "reasonable change" to the blockchain to "undo" some "criminal activity". Centralization has broken bitcoin's security model.
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65% of hash rate in China, 50% in single province (Score:2)
"65% of all bitcoin miners are located in China...": This is nonsense, ...
"For all of bitcoin’s promise of being the world’s first decentralized, peer-to-peer cryptocurrency, 65 percent of the total hash power resides in China ... If a couple of big Chinese miners were to switch off [or be cutoff by government], the hashrate will likely drop sharply, making the network less secure"
https://www.coindesk.com/highe... [coindesk.com]
... they will get cheaper electricity outside China
Apparently not less than Sichuan province, where 50% fo the total hash power resides.
"China is a large country and there are many poorly developed area
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You are misunderstanding what decentralization means.
Not at all. I am making a distinction between the theory of a cryptocurrency security model and the reality of Bitcoin's actual operations today. Basically that BTC has centralized, deviated from the assumptions of the theory, so the "single point of failure" concept no longer applies. I did not say the original theoretical security model itself is broken. I said BTC has deviated from it, lost decentralization, and therefore BTC has a broken security model.
At the mining level; The only theoretical attack is the 51% one. This is beyond countries capability at this stage.
No, "beyond countries capability in theory". In rea
I'll say it again... (Score:2, Redundant)
e-ponzi (Score:2)
wow, who could have imagined that e-ponzi schemes would be at least as successful at separating fools from their money as real-world ponzi schemes?
Re: e-ponzi (Score:1)
Bitcoin (Score:1)
And so things remain (Score:2)
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Your Your, I am calm.