BTC mining pool just reached 50% global mining power
blockchain.infoWhy does this matter?
One of the most notorious threats to blockchain-powered networks is allowing a malicious actor to obtain control over more than half of the network's computing resources. This situation is commonly referred to as the elusive "fifty-one percent attack." It is difficult, but not impossible to pull off —http://motherboard.vice.com/blog/bitcoins-fatal-flaw-was-nea... — the aggregation of this kind of hashing power. And it looks like we've nearly made it there again, but there is a difference between a pool getting > 50% of resources, and an "attack."
A successful attack using this method would allow the attacker to exclude, or "orphan" any new blocks from the valid chain causing all newly-minted coins go to the attacker. He may also execute a "double-spend" and reverse any of his own transactions during the window of time that his sham blockchain is considered authoritative by the network.
A successful 51% attack on Feathercoin — http://www.coindesk.com/feathercoin-hit-by-massive-attack/ — was stopped in its tracks by the network's natural uptick in difficulty in response to an increase in network hash rate. The Feathercoin attacker was likely executing a price pump in parallel to compromising the network, which caused coin-switching pools to mine feathercoin and increase the difficulty to a level that stopped the attack.
Interesting data point, thanks! If all the compute power that together forms the GHash pool were controlled by a single entity, this would be an issue. Thankfully that's not the case.
Please see my comment above. For all practical purposes, GHash pool owner controls the whole hashing power - he becomes the owner of each mined block and can do whatever he want's with it without users' consent.
What % of HN knows what this means? Maybe this should be a blog post instead and explain what a "mining pool" is. Or what is the significance of one pool taking over the market.
Anyone familiar with Bitcoin is likely aware of the 51% attack. A blog post is hardly warranted, because this isn't significant. GHash.io does not control all of that compute power. It is a metalayer that coordinates distinct and unrelated compute resources controlled by (supposedly) 180,000 seperate entities[0]. In order for a 50% attack to take place the vast majority (at this point) would have to agree to attack, and that simply won't happen.
[0] GHash.io homepage
I don't think you're right. The mining machines are pointed towards Ghash pool owner and he becomes the owner of the mined block - that's how he can distribute the BTC to everyone who contributed. So in practice, he controls the whole hashing power and can perform the attack without users' consent.
as a long time proponent of BTC, this is the first time I'm truly worried. Not that I think GH will do anything 'dodgy', just that it's actually happened and that's not a good thing at all.
GH just did a great job, I think when other competitors step up and provide as good a service - this will become a distant memory of the past - a blip on the radar (I hope).. There'll be a handful of decent pools, thereby never letting this happen again. (I hope again)
Bitcoin was supposed to be a decentralized system, not one with a centralized benevolent authority. In GHash We Trust...
Well, nobody is forcing anyone to participate in the pool. People can just switch to other pools. But here again greed will win, because those who participate in biggest pool can expect most reward.
and how much of the "unknown" is owned by GHash ...