[Cryptography] Bitcoin compute power (was Re: Aggregate signatures)

[Phillip Hallam-Baker]

On Tue, Jun 10, 2014 at 5:03 PM, Perry E. Metzger <perry at piermont.com> wrote:
> On Tue, 10 Jun 2014 22:09:21 +1000 "James A. Donald"
> <jamesd at echeque.com> wrote:
>> Bitcoin transactions are currently "voted" legitimate by the
>> majority of computing power.
>>
>> This will likely have bad consequences when the majority of
>> computing power is substantially different from the majority owners
>> and users of bitcoins.
>
> A very large fraction of the mining power on bitcoin is in the
> hands of one pool, ghash.io.
>
> It is close to exceeding 50%.
>
> https://blockchain.info/pools?timespan=24hrs

Fortunately it probably does not matter much when 99% of all bitcoin
activity is hoarding coins that will magically go up in value when
bitcoin replaces the dollar.

The Internet removes the middle man, BitCoin is a Ponzi scheme that
removes the need for a Bernie Madoff running it.

I would be less worried about the open 51% attack than the covert,
unannounced attack in which the same organization fronts multiple
pools. Another big concern should be what would happen if the cost of
mining exceeded the cost of running an appreciable percentage of the
rigs. At that point the only way to make money would be to shut down
the rigs, let the difficulty factor ease off and then bring them back
in bursts to unwind the chain.