Hacker News Reader

Comment by Havoc | Hacker News Reader

>Obtaining this much hashpower is incredibly expensive

Is it? Presumably you only need to maintain it for a short amount of time. Sounds like something one could smash with google cloud preemptible GPUs or similar. Especially since such an attacker is presumably not above using a stolen CC or three.

View on HN

Well, under the standard assumptions of blockchains like Bitcoin, yes it's incredibly expensive to obtain enough hashing power to do a 51% attack. There's a lot of nuance to it though.

In this case, Bitcoin Gold chose to have an "ASIC Resistant" algorithm, Equihash, and likely was only protected by GPUs mining the network. Bitmain has recently released an ASIC for Equihash that is substantially cheaper and more energy efficient than using GPUs, meaning that some pool which was able to buy a large number of the ASICs would have had a pretty easy time gaining enough hashrate to launch a 51% attack.

This is one of the big risks of attempting ASIC resistance. In the event that someone produces an ASIC, your coin is a complete sitting duck.

but hashrate on BTG has been falling consistently since inception, it doesnt look like someone invested in a load of ASIC devices to perform this attack, more like they kept the same operation and watched its % grow as other miners left the chain for a more profitable coin.

The hashrate charts don't measure orphaned blocks, so the attacker hashrate (manifested in the form of a bunch of orphaned honest blocks) wouldn't be visible in that chart.

Under normal free market assumptions, the cost of double spending is simply the expected reward of each block multiplied by the number of blocks that need to be mined. For bitcoin, where the reward for finding a block is currently ~$100,000, that means you should be able to double spend by mining 6 blocks at a cost of less than a million dollars.

The question is: are bitcoin miners subject to the usual free market assumptions? If someone offered you double the market rate to hire a bitcoin miner for an hour would you accept that offer or not?

As a miner, you are likely not going to accept because your entire revenue stream comes from the cryptocurrency being stable. If someone uses your hashrate to launch an attack, it's a direct threat to your future revenue especially if the attack discredits the security of the token you mine.

In this case though, Bitcoin Gold shares a hashing algorithm (Equihash) with many other blockchains. It is possible that some Zcash mining farm decided to attack Bitcoin Gold because they felt the revenue from attacking Bitcoin Gold was greater than the potential damage to their income, which is primarily Zcash based.

I'm just grasping at straws here, but generally speaking it's a bad idea to share hashing algorithms with another cryptocurrency, especially if that cryptocurrency is substantially more valuable (in terms of monthly block reward) than your own.

And, all GPU-mined coins are essentially sharing one algorithm, because the hardware can jump between them easily. So all GPU based coins share this vulnerability, where the tiny GPU mined coins could easily be attacked or wiped out by a large Ethereum farm at any point.

The math doesn't work that way because honest miners amortize the capital cost of their specialized equipment over long periods of time. An attacker undermines the network's value and so must operate on shorter timescales. The capital costs of an attack could perhaps be partially recovered via resale, but getting order ~50% of the existing network's specialized hardware might prove prohibitively difficult even given sufficient capital.

[edit] And renting existing miners' equipment would be difficult because you would have to: figure out who they are, convince them to point their equipment to your pool, run your own dark pool servers to handle data from tons of miners, run infrastructure to make payouts to these miners, hope that exchanges don't have reorg procedures that prevent you from accomplishing your double spend, hope your chain reorg doesn't panic the market for long enough for you to double spend exchange to another coin that won't be tanking (due to the reorg).

Also they only need to hold 51% for as long as they can complete the double-spend attack.

The article says they reversed some transactions up to 22 blocks later, which is 220 minutes, or 3 hours 40 minutes. So they would only need 51% for that time, but they didn't just add 51% of hashing power or that would be noticeable on the charts. From the looks of it [0] the hashrate has been falling slowly since BTG was created, so the miner may have just become the one with 51% by virtue of keeping mining with the same setup and then watching others stop mining, increasing his share of the network with no extra effort on their behalf. I would assume this miner also realises that BTG is dead/dying and is trying to extract as much as possible from it before they move their equipment to a new chain. If this attack method proves sufficiently profitable perhaps the miner will look at dying chains he can easily overpower instead of trying to mine a more profitable chain with a higher hash rate.

[0] https://bitinfocharts.com/comparison/bitcoin%20gold-hashrate...

The hashrate doesn't measure orphaned blocks.

Totally, i even predicted this would happen 5 months ago (Not the crash yet though): https://news.ycombinator.com/item?id=15836819

Reply on news.ycombinator.com