What Is A 51% Attack?

What Is A 51% Attack? - Moniedism

We will introduce "51% attack" which is one of the risks that you should know before investing in such Bitcoin.

Bitcoin, a cryptocurrency whose price does not stop rising. The news that 1 bitcoin has exceeded $
62,575 has been talked about, but there are risks in bitcoin trading.

What is Bitcoin in the first place?

Bitcoin is a currency created based on a technology called a blockchain. Cryptocurrencies such as Bitcoin have a floating exchange rate system with legal tenders such as dollar, and there are price movements of Bitcoin price and cryptocurrency price.

We won't go into details about how Bitcoin and blockchain work, but the simple explanation is that Bitcoin is created as a reward for people called miners who maintain and manage blockchain.

A blockchain is a mechanism that collects Bitcoin transaction records into several blocks and connects them back and forth like a chain.

The blockchain is not managed by a central server like a banking system but is managed by each minor computer in a distributed manner. It is said that tampering with the blockchain is extremely difficult due to its mechanism, and its high security is attracting attention in each industry.

51% attack on Bitcoin

What is a 51% attack?

A 51% attack is a type of hijacking in which a malicious group or individual controls 51% (or more than 50%) of the mining speed of the entire blockchain network and conducts fraudulent transactions.

In the current blockchain system, the legitimacy of the transaction is determined by a majority of the computers of people called miners who effectively manage and maintain the blockchain.

For example, if 51% of PCs give the opinion that "this transaction is A" and 49% of the PCs give the opinion that "this transaction is B", then a large number of "this transaction is A". Priority is given to the opinion.

A 51% attack is a takeover that takes advantage of this, allowing a malicious target to maintain a mining speed of 51% and gain substantial control over its blockchain.

It is an attack that shakes the foundation of cryptocurrency and blockchain, but there is currently no effective countermeasure against this.

Risk of not being able to make legitimate transactions

A 51% attack allows a malicious target to deny a legitimate transaction. As a result, even if you use cryptocurrencies in a legitimate way, malicious targets will refuse payments or make remittances impossible.

Risk of fraudulent transactions

There is also the risk of fraudulent transactions being carried out by the target that controls the blockchain. For example, the fact that a remittance of 100,000 dollars can be disguised as a remittance of 1 million dollars.

In a 51% attack, there is a risk that a malicious target with a processing speed of 51% will be able to make unfair profits such as making transactions that are not possible or increasing the balance.

Price crash

However, it is said that 51% of attacks will not occur. The reason is that if Bitcoin and its blockchain are damaged by a 51% attack, they lose their trust in themselves. I

f trust in the blockchain is lost at the time of launching a 51% attack, the sale of the cryptocurrency will accelerate and the price will plummet. No one will try to use that cryptocurrency.

This means that even if a malicious target tries to make a profit from a 51% attack if the price crashes, it will not be possible to make a profit. As a result, there is no merit in making a 51% attack, and it is said that a 51% attack will not occur because it is a pain.

Difficulty controlling mining speed of 51%

Another reason that 51% of attacks are less likely to occur is that mining Bitcoin and cryptocurrencies require enormous energy. The enormous energy is electric power. Although a dedicated computer is operated for mining, it requires a huge amount of power to handle problems that are difficult for the computer.

Therefore, controlling the mining speed of 51% will cost more than the profits obtained by attacking 51%. This electricity bill problem is also cited as one of the reasons why 51% of attacks do not occur.

Beware of 51% attacks, albeit unlikely

We have introduced the 51% attack on Bitcoin. It is said that launching a 51% attack is not something to worry about, as it is a real loss to the launcher.

However, the current Bitcoin miners are becoming more commercialized and oligopolistic, and if the miners negotiate, it is not impossible to launch a 51% attack. It is important to be aware of these risks when investing in cryptocurrencies such as Bitcoin.

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