What is a 51% Attack?
Understanding the basics of mining and blockchain technology is very important before diving into the 51% attack.
The goal of consensus is to ensure that the network can collectively agree on the correctness of transactions and the mining process. Having a strong consensus algorithm is also necessary to verify the validity of transactions.
The decentralized nature of Bitcoin’s infrastructure prevents any central entity from making use of it for their own purposes.
If a single entity or organization has more than 50% of the hashing power on a blockchain network, it can execute a 51% attack.
A successful majority attack would allow the attacker to modify or exclude transactions from the network. This would prevent the attackers from being able to execute transactions while being in control.
Creating coins that are not owned by the attacker is also considered an impossible event. 51% attacks are very difficult to prevent.
Miners do not want to invest large amounts of money in order to get rewarded with the block reward. A 51% attack on Bitcoin is very unlikely due to the network’s size.
The higher the number of confirmations a block has, the more costs are associated with altering or reversing transactions in the network.
Even if the attacker succeeds in disrupting the network, Bitcoin’s software and protocol would still be modified in response. This means that the other network nodes would agree to these changes.
Although it is very difficult for an attacker to get more computational power than the Bitcoin network, altcoins are still vulnerable to 51% attacks.