Cryptocurrency News – Why are 51% attacks becoming so common?

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Recently, there was a 51% attack on Ethereum classic (ETC). The problem is that 51% attacks can destroy your confidence in cryptocurrencies. It can drive away investors of that cryptocurrency. That is why it is essential that cryptocurrency developers tackle 51% attacks as soon as possible to reduce the probability of the same. The question is why is the frequency increasing.

Why are 51% attacks becoming so common?

The number of cryptocurrency minors is reducing. Cryptocurrency mining for most of the cryptocurrencies is becoming an unprofitable venture. In such a case, anyone can invest a certain sum of money to gain a 51% computational power of the entire blockchain. When that happens, the dominant mining power for any cryptocurrency will fall into the hands of a single individual. The 51% attack can only occur when 51% or more of the total mining power is under the control of one single entity.

The blockchain works on the basis that the longer chain is always the more legit one. Therefore, if the regular minors produce a chain of ledger transactions and the fraudulent miners produce a longer blockchain, the longer blockchain will replace the legit one. In such a case, the longer blockchain can erase the transactions or induce fraudulent transactions and make them pass off as genuine ones.

The cost of gaining 51% mining power in any cryptocurrency is coming down. It is because many cryptocurrency minors are abandoning their operations due to losses. While it is still pretty costly to conduct a 51% attack on Bitcoin (BTC) but it is not same for the smaller cryptocurrencies like Ethereum classic (ETC). There is even a dedicated website by the name of Crypto51 which calculates how much will be the cost of garnering 51% mining power. The price comes to $ 300,000 an hour for Bitcoin (BTC). It would need to be run for at least 8 hours to change a single block of transactions.

On the other hand, when you’re looking at something like Ethereum classic, it will cost you $ 4000 an hour. You can create a substantial chain in just 15 minutes. Thus, the smaller cryptocurrencies are more susceptible to attack as conducting the 50% attack is more affordable.

The reason why the 51% attacks are increasing is that the number of minors in most of the smaller cryptocurrencies is decreasing. Also, it is becoming more and more affordable to conduct the attack due to this very reason. There are a few steps which developers can take to avoid such attack, but up until now, most of the developers have not been proactive.

About Priya 131 Articles
I am an IT engineer by qualification and like to explore the crypto and blockchain space in my free time.

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