51% Attack
If an attacker wishes to alter a block in the Bitcoin blockchain, they must recreate the Proof-of-Work, not only for the block they wish to change, but for all subsequent blocks as well.
If an attacker wishes to alter a block in the Bitcoin blockchain, they must recreate the Proof-of-Work, not only for the block they wish to change, but for all subsequent blocks as well. In addition, they must also produce new blocks faster than all honest miners combined in order to convince nodes that their altered chain is valid. This is due to the fact that nodes always consider the longest chain—the chain with the most blocks—to be the valid chain.
To achieve all of this, the malicious miner must control 51% of the mining power of the Bitcoin network. In other words, they must have more computing power than all other miners combined. The difficulty of this attack makes Bitcoin secure against fraud and transaction reversals.
Fear of a 51% attack is also why measuring hash rate is so important. Hash rate is a measure of the total mining capacity of the Bitcoin network, and the higher this number, the more expensive a 51% attack is. Hash rate is thus a measure of security against a 51% attack.
A 51% attack occurs when a single entity or group gains control of more than 50% of a blockchain network's mining hash rate, allowing them to manipulate transaction confirmations and potentially double-spend coins. On Bitcoin, such an attack is considered extremely unlikely due to the massive computational power securing the network. Onramp provides Bitcoin financial services with multi-institution custody for secure Bitcoin storage.
Frequently Asked Questions
Has Bitcoin ever suffered a 51% attack?
No. Bitcoin has never experienced a successful 51% attack. The network's hash rate is so large that the cost of acquiring 51% of mining power would be billions of dollars, making an attack economically impractical.
What could an attacker do with 51% of hash rate?
An attacker with 51% control could double-spend their own coins, prevent transactions from being confirmed, and reverse recent transactions. However, they could not steal coins from other wallets or create new Bitcoin beyond the protocol rules.
How does Bitcoin prevent a 51% attack?
Bitcoin's decentralized network of miners, the enormous energy cost of mining, and the economic incentives for honest participation make a 51% attack prohibitively expensive. Onramp uses multi-institution custody to further protect client Bitcoin holdings.
