BTC Vulnerability? (Massive Attack against BTC system. Is it really?)
Hi. (I’m sorry if I don’t understand any concept). What you think if anyone intruder will buy up bitcoin currency and erase all binary data. This way can destroy bitcoin systems. Is btc network protected against that attack?
(Hypnotically) If I run any two (or more) unique e-currency exchanger I can displace btc e-currency from it circulation. I seems, “truly” system must include mechanisms that protect self from any fraud activity. And what do you think?
2Developers and BTC-system designers: please, join to discussion
I don’t think you understood my point.
It is a lot easier to arrest and lock up the prominent bitcoin users than to manipulate the market. Like it was pointed out, a market is not just a single currency, it can be a lot of different types of currency and goods. Trying to manipulate one end or the other would be difficult. It is better to just get the people - fear of being arrested is much more effective than trying to shake up confidence in the currency.
Destroying a large amount of currency just causes deflation and makes the remaining currency that much more desirable - imagine if you had a pallet of gold bars in your garage and nobody else did.
Maybe you don’t agree with my assessment of the situation but what you posted was far from constructive.
In response to your original post, I don’t believe the situation you describe is a big risk.
I don’t think you understood my point.
Ok, let’s elaborate It.
You wrote:
Quote from: Laszlo Hanyecz on July 08, 2010, 8:25:25 AM UTCIt is a lot easier to arrest and lock up the prominent bitcoin users than to manipulate the market.
But I write earlier:
Quote from: user on July 07, 2010, 9:15:28 AM UTCWhat you think if anyone intruder will buy up bitcoin currency and erase all binary data. This way can destroy bitcoin systems. Is btc network protected against that attack?
And If you try to lookup subject carefully you can find:
I don’t discuss in another attack that you indicated (I understand you idea: attack to system through people).
Ok. Follow next.
Quote from: Laszlo Hanyecz on July 08, 2010, 8:25:25 AM UTCMaybe you don’t agree with my assessment of the situation but what you posted was far from constructive.
The main idea why I begin this thread:
Quote from: user on July 07, 2010, 11:57:27 AM UTCQuote from: Laszlo Hanyecz on July 08, 2010, 8:25:25 AM UTCI seems, “truly” system must include mechanisms that protect self from any fraud activity.
In response to your original post, I don’t believe the situation you describe is a big risk.
But I think that It will be better if in design-time developers build mechanisms that decrease potential of fraudulent ability. And you?
Please, explain me if I am wrong. I want to understand you reflections.
You can’t destroy them all, more will be generated constantly. That 21 million number is not going to be reached in the foreseeable future. As you know, the generation algorithm adjusts itself to slow the generation rate intentionally.
It is unnecessary to protect against an attack in which an attacker buys all Bitcoins and deletes their wallet.
Assuming we were all willing to sell, the attacker would just give us large amounts of cash for our Bitcoins. We could then start another Bitcoin block chain and start over from square one (only with a much larger confidence in the market, since it worked once!) and reinvest that money if we wanted.
Essentially, no matter what happens there is always the nuclear option of “starting over.”
There are much more dangerous and likely attacks to be worried about.
What the OP described is called “cornering the market”. When someone tries to buy all the world’s supply of a scarce asset, the more they buy the higher the price goes. At some point, it gets too expensive for them to buy any more. It’s great for the people who owned it beforehand because they get to sell it to the corner at crazy high prices. As the price keeps going up and up, some people keep holding out for yet higher prices and refuse to sell.
The Hunt brothers famously bankrupted themselves trying to corner the silver market in 1979: “Brothers Nelson Bunker Hunt and Herbert Hunt attempted to corner the world silver markets in the late 1970s and early 1980s, at one stage holding the rights to more than half of the world’s deliverable silver.[1] During Hunt’s accumulation of the precious metal silver prices rose from $11 an ounce in September 1979 to nearly $50 an ounce in January 1980.[2] Silver prices ultimately collapsed to below $11 an ounce two months later,[2] much of the fall on a single day now known as Silver Thursday, due to changes made to exchange rules regarding the purchase of commodities on margin.[3]”
http://en.wikipedia.org/wiki/Cornering_the_market
I think the bigger problem, as others mentioned, is shadow interests buying/selling to create speculative bubbles and subsequent crashes. They could orchestrate these events at critical times (during a version release or media event) to discourage new users. Shadow interests will have enormous funds and won’t be concerned with making a profit.
Even if they could corner the market, it wouldn’t do them any good. The same goes for buying and destroying. Both would cause massive deflation and an ever higher price.
I think the bigger problem, as others mentioned, is shadow interests buying/selling to create speculative bubbles and subsequent crashes. They could orchestrate these events at critical times (during a version release or media event) to discourage new users. Shadow interests will have enormous funds and won’t be concerned with making a profit.
Even if they could corner the market, it wouldn’t do them any good. The same goes for buying and destroying. Both would cause massive deflation and an ever higher price.
I would be more worried about these shadow interests developing a rival chain rather than them giving away free money for bitcoins… the second option makes bitcoin users richer, whereas the first one could invalidate the whole value of their coins.
Quote from: dwdollar on July 09, 2010, 4:55:52 AM UTCI think the bigger problem, as others mentioned, is shadow interests buying/selling to create speculative bubbles and subsequent crashes. They could orchestrate these events at critical times (during a version release or media event) to discourage new users. Shadow interests will have enormous funds and won’t be concerned with making a profit.
Even if they could corner the market, it wouldn’t do them any good. The same goes for buying and destroying. Both would cause massive deflation and an ever higher price.
I would be more worried about these shadow interests developing a rival chain rather than them giving away free money for bitcoins… the second option makes bitcoin users richer, whereas the first one could invalidate the whole value of their coins.
If someone were to try to take over the bitcoin network by developing a rival chain they would have to have a lot of money to throw away. My analysis follows:
My computer cost - $700 My computer hash rate - 750 khash/s My computer avg time to generate block - 3 days
Whole network blocks generated in 3 days - 2200 Whole network CPU power estimate - 2200*750 = 1.65 billion hash/s Cost estimate for network takeover - 1.54 million $USD
Estimated Value of whole bitcoin economy at highest exchange rates - $53,640
The only thing I wonder about is what it would cost to rent a botnet to do this for me without actually buying all these computers.
Anyone have an idea?