51% Attack Bleeds More Than $5M from Ethereum Classic | Hacker News Reader

51% Attack Bleeds More Than $5M from Ethereum Classic

cointelegraph.com

30 pointsguiambros15 comments

Is this actually illegal? And if so, how would a court proceeding look like? I am pretty sure especially in the US, if you have money for a good lawyer, you can wiggle yourself out of this one pretty easily. Just imagining the jury overseeing this... Who is even the defendant? And what is the crime?

I imagine if such a case ever goes to court its going to be very interesting, because for the government, this should be like being stuck between a rock and a hard place. Acknowledging this as "theft" kindof undermines their agenda to kill off alternative currency.

There is also another dimension to it. "Double spending" conceptually seems very similar to the government printing money, devaluing the dollar.

Depends where the spending went. It's fraud to agree to buy something and not pay.

But who is selling anything for Eth?

> Acknowledging this as "theft" kind of undermines their agenda to kill off alternative currency.

Whose agenda?

> Whose agenda?

Governments generally have no interest in alternate currency systems that are not under their control, taking off. So far, crypto currency has been flying under the radar and the ones that have broad support from financial institutions go against the very idea of Bitcoin and Etherum, i.e. they are not providing much of the benefit that supporters of crypto currencies are interested in.

While it's true for the central banks (that Bitcoin is the competitor of), many of the big financial institutions are getting envious of the fees that Coinbase charges.

Total Coinbase fees already went over Intercontinental Exchange fees in the last cryptocurrency bubble (because of the large margins).

It's ETC. ETH is a separate currency.

Double spending is nothing like printing money

And it would be trivial to convict on this - they deposited huge sums into exchanges, traded them for another currency, then double spent the deposit

It's just theft

Could one automate this 'as a service'?

Imagine a webpage with a box to paste a transaction you want reversed. It will quote you how much it costs to undo that transaction, and if you're happy you pay that amount.

The service would make money if multiple people wanted transactions reversed over the same time window, since the 51% hashpower cost only has to be paid once, even though you get paid twice.

Terrifying, I wonder how big of a miner community you need to stop this from happening. How much would it cost to do this for bitcoin?

It's very much 'by design' in the currency... Anyone who accepts an incoming transaction should wait the necessary amount of blocks to verify that transaction, and for large amounts of $$$'s, one should wait longer. The waiting time should be at least the cost of 51% of the hashpower for the value of the transaction.

Clearly some exchanges weren't following that rule!

This doesnt make sense to me -- as I understand it, controlling 51% of the hashing power means you can eventually undo any transaction in the system, because you can start from any point, and mine from there. As long as you continue to hold 51%+, you'll eventually have the longest chain, and thus the official history. That is, there is no protection from a 51% attack, except time and difficulty to continue the attack until success.

Waiting for a certain number of blocks is only to reduce the probability of natural fork eliminating the transaction (by eventually outgrowing the fork you included your transaction into) to infetesimally small.

4000 blocks is also, I think, extremely deep into the chain. As I recall, bitcoin exchanges default to like 6 blocks before confirming?

At least, this was from my readings into bitcoin -- not sure if ethereum changes that equation, but im fairly positive it doesnt.

Hashpower is rented these days. So the question becomes 'how much hashpower you need for how many days'. Which has a dollar value.

If you are verifying a transaction of a given value, you would be stupid not to wait the dollar value of the hashpower required to reverse the transaction. If you run a service and someone could sign up for multiple accounts, you should take that into account too...

Unless someone actually buys a facility (or facilities)with express purpose of making a monopoly, and does not rent it for cheap to others.

Detecting the attack or vulnerability to it is easy in smooth difficulty increasing proof of work systems by looking for spikes in difficulty... But waiting for too long is not acceptable.

> 4000 blocks is also, I think, extremely deep into the chain. As I recall, bitcoin exchanges default to like 6 blocks before confirming?

This attack was against Ethereum Classic, which has a block time of 13 seconds. 4000 blocks ≈ 14 hours.

So this will just be happening to all altcoins until they're dead. I hope.

Only the PoW (proof of work) ones.

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