If this becomes more prevalent, the longer confirmation times will start to noticeably diminish the value of bitcoin.
but isn't counting confirmations somewhat a placeholder for counting time?
eg. longer wait between blocks = more confidence in each block.
eg2. if blocks came every ~5 minutes, mtgox might wait for 12 confirmations on deposits... if blocks came every 20 minutes, they might only wait for 3.
No the # of confirmations increases the difficulty of an attacker getting lucky.
Like trying to flipping a coin 6 times and getting 6 heads in a row is harder than getting 1 heads in a row.
Regardless of block times if you want "6 confirms" worth of security you need to wait for 6 confirms.
The larger the % of hashing power an attack may have the more confirms you need to have a given % chance (say 99.99%) that he can't reverse a transaction. Obviously once attacker has 51% hashing power no amount of confirms provide security. Satoshi lays out the math at the end of his paper.
