Topic: Those with an incentive to attack the bitcoin network (Read 3597 times)

I seriously never understood why people take the market cap as a measurement. You could send the "same Bitcoin" every day from address to address and suddently there are 4*356 Billion USD floating around in a year.

I don't know how significant can be cryptocurrency transactions within a single country when on a global scale the bitcoin has a 4Billion USD market. Is the encryption ban directed towards cryptocurrencies? It sounds to me more like the government wants to listen to peoples internet calls, read emails and more. If banks wanted to bring down bitcoin, I don't think they would need such measures. Why not just ban cryptocurrencies then? Cheaper than attacking it.

It would definitely be crazy if it happened, and an encryption ban might give them cover to do it. I also think if a government saw significant tax revenue being lost to anonymous cryptocurrency transactions, it is not beyond the realm of possibility that they might attack the network directly.

This encryption ban is funny. I read first about it, then I read they made a U-turn and won't ban anything then again "no U-turn" and still planning to ban. Funny what are they doing, probably some media blinding tactics.

Banks are of course against cryptocurrencies, but I don't believe they pose enough threat yet. Better said, I don't think bitcoin poses enough threat for them to take such drastic actions.

I see the threat coming more from banks rather than other established payment systems. When you have the ability and to power to print an infinite amount of money, you can always use that as a tool to manipulate the market and crash bitcoin prices. It's amazing how the fiat system works. On the other hand, the rest are just presenting a miniscule threat, as you need funds, and lots of them, to actually manipulate the market. 

It would be pretty crazy to have the government come out in public and declare the war on bitcoin or crypto currencies, with the possible encryption ban in the U.k could that be the begining, from the war on drugs now to the war on encryption and bitcoin.

Good addition. The thought of miners being able to gather enough of the fees from their own attack to keep it going (to drive up fees) had occurred to me.  Although I wasn't capable of doing the math to see if it was feasible. Cryddit worked it out the math in his "Golden ratio attack" thread, and it seemed doable but he's since deleted his post so I'm not sure if it was after all.

As for (6), many exchanges seem to have shady trading accounts on their own exchange, probably with an enormous bankroll, so if they thought they could drop the price with an attack, they could benefit from shorting (admittedly unlikely). I think a more likely scenario would be just using an attack to induce volatility. If there was a period of great stability in the price of bitcoin, this could hurt exchanges because volume would likely decrease. I haven't checked the stats, but I'd guess increased volatility is correlated strongly with increased volume. And, increased volume means more income for the exchanges from trading fees. Price swings are what keep the exchanges in business. I guess it would come down to how much price volatility an attack could induce.

I hope you're right. And I actually I hope they'll do this billion dollar waste of money: they deserve it. So that we can start mining again and keep this technology decentralized

If they create a fork, then no one will use their fork, which will be a billion dollar waste of money. Bitcoin in its essential are a consensus reached among its users, voluntarily participating. You can not force people to use certain fork of bitcoin. Large mining pools can indeed modify transactions and even do double spending if they control majority of the hash power, but they can not affect the existing coins, which is the major usage of bitcoin right now: Long term store of value. Constant turbulence in transaction space will just drive the demand to long term saving area

None of these would do much except bleed you of your money. If a bank wanted to launch a 51% attack consider how many millions of dollars it would cost to get that hash power. But let's say they do it anyway. A 51% attack would create temporary chaos on the network but it would be detected right away and would not last long. Within hours you would likely be broke and we would be back.

When banks froze Greece bank accounts, they definitely raise the value of euro in the eyes of Greece people, and Greece parliament passed an even more strict austerity proposal to get those euros  

And since majority of the bitcoins are being used as long term storage, the raised fee will not affect most of the users, only exchanges and payment processors. Long term savers with more than 10 bitcoins does not care if they should pay 0.01 or even 0.1 bitcoins for a 10 bitcoin transaction

We are not talking about 51% if a bank attack. They would go 100%. Then the fork they controll win.

That's not how Bitcoin work, that is not how any of this work.
You can't change the rules with a 51% attack.

Educate yourself before posting BS.

they want to see how far away they can go with abusing the network, without putting a strong dent on bitcoin itself, and causing people to abandon it, because miners aren't stupdi they know that if bitcoin die or fade away they will lose a big opportunity to make profit

for returning to gpu era, bitcoin would have to change its algo repeatedly, like they have done with vertcoin, maybe we should have adopt this solution...

there is still a chance that a bitcoin like this will be adopted in the future, if this Bitcoin will fail

Let's be honest guys: decentralization, right now, is only theoretical.

No one can assure us that the BTC network will be free from this miners monopoly because this is what it is now.
Maybe before 2013 it was true: when we were mining with no more than gpu it was widely distributed among several people.
But now?

If you have dirty cheap electricity rates and good amount of money you can decide to start ruling in here. And last days prove this.

There's no math needed to understand it.

If the banks really wanted to control bitcoin they could simply purchase the 2-3-4-x largest mining farms that would give them 51% of the hashing power and voilà. So theoretically it could be still controlled by a single person. However, as for now I agree it is probably a coalition of miners who control the network, which is also different from a truly distributed network.

i think the main difference is that it can not be controlled by one person, when you do a comparison with a bank

but many people controlling it is not the same, because it's based on consensus, the problem here are miners that can exploit the network for profit


they want more profit, everything is done for this reason, chinese does not care about bitcoin

after all they started with bitcoin after it has gained some traction with doge, they weren't interested before, one should wonder why

If the banks should ever decide to attack bitcoin they would to it proberly. Not making a small spam attack...

How i would do it:

1 - Get eough hashing power to do a 51% attack
2 - When the attack is complete you change payout to miners to 25K
3 - Change difficulty to new blocks ever minute
4 - Open the traders on a big screen
5 - Sit back with a glass of cognac and see the bitcoins flowing the market

Why are they so aggressive? If bitcoin harms their benefit, it can also have the power to bring them benefits.

My #1 guess would be the big banks. Although not many will talk openly about it, they all know that bitcoin threatens their entire industry, which rakes in billions of dollars by investing OPM (Other People's Money). The only reason banks have so much money and power is because they are the financial "gatekeepers" so to speak. They control everyone's savings, loans, investments, etc. and exploit this for huge profits. No central gatekeeping, no money for banks. They are also corrupt as heck and will not bat an eyelash at buying off governments, bribing people, etc. to keep the big bucks flowing. Some of this got exposed in the 2008 crash, but big players like Goldman Sachs, BofA, CitiBank, JP Morgan Chase, etc. are still around. An attack on the bitcoin network would be trivial for them, and well worth their investments.

I don't think anybody that profits from bitcoin, such as Chinese miners, would conduct an ongoing attack. The short term gains are not worth the long term bad publicity, lack of adoption, etc. They need more people to use bitcoin, not less.

The only other possibility is a government, perhaps US (NSA) or China. Bitcoin also threatens fiat, which is the source of any government's power. They can simply print money to execute their programs when people use fiat.

Always follow the money and look at what big interests are threatened.