The Realistic Lucrative Case of Ethereum Classic attack — Today

To Recap..

How much that 51% consensus attack cost

  1. ETC Nethash averaged of 7000 GH/s (6600 to 7200 GH/s according to ETCstats , BitInfo respectively)
  2. Most efficient miners are Antminer E3 with 0.18 GH/s and Radeon Rx 480 with 0.025 GH/s
  • Barrier of entry is high you still need to buy miners, setup farm, and all logistics right.. or
  • Well if you have all that hashing power you’re better off mining coins than attacking the network!
  • The Barrier of Entry: Have we forgotten that many PoW blockchains share the same hashing algorithm, — particularly the forks —
    Ethereum Classic uses ETHASH (the same algorithm as Ethereum’s) I mean you don’t need to setup or buy anything at all, If you’re already mining Ethereum, and your pool contributes with small percentage of only 2.5% of Ethereum Nethash, Switch to mine Ethereum Classic and you’re now +51% of hashing power of Ethereum Classic network. First, there is no barrier of entry for you, and second, your cost of 51% attack on ETC is your ETH mining profit per day, for a miner mining 2.5% of ETH Nethash the gain is about 525 ETH per day which is ~$380k USD, which is pretty much the cost of 51% on ETC per day, and please let’s not forget that the Ethereum Classic network has a ~2 billion market-cap.
  • The ‘Better off mining coins than attacking’: No you’re not, with that 7000 GH/s mining power you have which is about 2.5% of ETH Nethash you’re making currently 525 ETH or ~380k USD per day. However, by attacking ETC, while short-selling ETC with n margin on the open market would make you 3x to 100x that profit from the ETC price decline — We will discuss this in details in a bit..
List of Top Ethereum Miners with more +7 TH/s hashrate (byzantine candidates for ETC)

The Profitability with Price Decline

The Models for the Calculation of a 51% Attack

  1. The Classical model (Based on cost of acquisition) we have used for years, — well detailed in Mario Dian post here, calculates the cost of acquisition of enough miners (ASIC/GPUs) which will generate the total hash of a the target network + electricity, and the one used at beginning of this article and we used in Rindex v1.0:: The Robustness Index,
    ex. for ETC with current 7 TH/s nethash the 51% attack cost is
    $70 million
  2. Vlad Zamfir in Simple model of an internal PoW attacker introduced a sound assumption that honest miners working in their best financial interest would switch to mine on a different network when you add hashpower to current networks. That when you add a smaller % like 3.5 TH/s to ETC of 7TH/s, the total nethash truly becomes 10.5 TH/s and you’re controlling only 33%, but as as difficulty adjustments make it no more profitable for honest miners to continue mining ETC, they would switch to mine on different networks and you end up with +51% .
    ex. for ETC with current 7 TH/s nethash, 51% attack cost max $35 million
  3. Rindex v2.0 model (The cost of hashpower leasing)
    Revenue per GH/s * Target network Nethash = 51% attack cost
    ex. for Ethereum Classic: 75 (ETH revenue per TH/s day) * 7 (ETC nethash) = 525 ETH per day = $380 Thousand dollar

What about the cost of attacking other coins?

Conclusion

  • Upgrade to PoS, check out Casper FFG, PoS in general is much safer and 51% practically infeasible, but by just adding Finality the Capser FFG style you will significantly increase robustness.
  • Upgrade your hashing algorithm (In a way you’re not using the same hash algorithm like other chains that have significantly more hashing power)
  • Increase required confirmation (A LOT More) a byzantine miner can send an ETC equivalent of $100mm swap it for BTC, while mining his own in-shadow chain disconnected from ETC, and when he liquidates his $100mm he propagates his in-shadow blocks. As it has more hashing power behind it, and because it is the longer chain, it would replace the current one and the miner would now be ‘double spending’.
  • Emergency preparedness, stay one step ahead with a miner, exchange and developers coordinated action plan

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"Freedom, peace and longevity grounded in the decentralization and distribution of power." Stars watcher, Decentralization Enthusiast & Supercontinenistist

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Husam ABBOUD

Husam ABBOUD

"Freedom, peace and longevity grounded in the decentralization and distribution of power." Stars watcher, Decentralization Enthusiast & Supercontinenistist

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