Is Blockchain really safe? 51% attack and Bitcoin SV (BSV)example
In my previous article, I have mentioned that Blockchain is a technology that is known to be safe and cannot be altered because it is a distributed database in which everyone has the same information recorded in their blocks, and each block refresh constantly to match the information from the majority when something is changed.
If you have not yet read my previous article, please do so:
Easy to understand ‘What is Blockchain?’ Explained with simple analogies
If people corporate to alter the data by forming a majority, it is called “51% attack”
If 6 people out of 10 alter the record at the same time, this terminology is called 51% attack, which means by, people cooperate to alter the truth by forming a group of majority. So if A,B,C,D,E,F alters the record and says A has $1million instead of $30, it is 6vs4 therefore A’s balance will be changed to $1million from $30. However, this is considered to be impossible within the Blockchain system because millions and billions of people share the same record. Realistically it is even impossible to alter 1% since there are too many people within the network. Therefore, people say Blockchain is a technology that can never be hacked whatsoever.
However, a recent 51% attack that happened to Bitcoin SV (BSV), a hard forked token out of Bitcoin (BTC) proved that 51% attack is still possible in the Blockchain system.
Malicious miners took control of more than 50% of a proof-of-work blockchain and took advantage of block reorganization, a feature to clear up the incidence when more than two miners mined the same block. When two versions of the same block are mined, the system gives a token to the longest chain in default. However, attackers took over 50% of a proof-of-work blockchain therefore they were able to create a longer chain so that the system rendered the honest miners’ blocks invalid.
The attack was still underway as of 7:30 UTC, the initial reorg affected as many as 100 blocks and new reorgs are still occurring. About 3 different versions of BSV chains were mined at the same time. Lucas Nuzzi from Coin Metrics said that hackers took control of the network for over 3 hours.
The first reorg was about 100 blocks deep. Nikita Zhavoronkov, the lead developer at Blockchain analytics platform Blockchair, on his Twitter he added that it wiped over 570,000 transactions.
The attack is now ended, however, there is still confusion between different mining pools, and pools mining on different block heights at the moment.
All this Bitcoin and Blockchain boom started because of Blockchain’s trustful security system, however, it is already attacked by anonymous hackers.
Will Blockchain technology develop to prevent further attacks? Is it safe to use Blockchain instead of banks? This recent 51% attack on BSV lets us question a lot of things.
