Why the 51% attack says more about the state of the crypto industry than the BSV blockchain
This post originally appeared on the Unbounded Capital website, and we republished with permission from Zach Resnick.
Last week, we saw a malicious attack on the BSV network. Much of the crypto media described this as an attack with the aim of stealing money via a double spend. But this attacker spent merely hundreds of thousands of dollars where there was effectively no chance of this ending in theft: this was likely a public relations attack.
The integrity of funds on the BSV network was not at risk whatsoever by this attack besides those involved in a tiny number of anonymous transactions for a very short period of time. It’s worth noting that other networks like BTC have had double spends and reorgs as well in the past without compromising funds of network participants.
The only real attack vector opened up by a 51% attack is anonymous transactions with exchanges. If the crypto industry weren’t so “anon-friendly,” and the liquidity for crypto-assets weren’t so tied up with anonymous actors and criminals, this 51% attack wouldn’t have even been able to be the non-issue it was.
Getting double spent is like getting a bad check. If you get a bad check from someone you know, it is still a problem, but it’s easy to litigate and makes the incentive to hand over the bad check very low. If you accept checks from anonymous parties, then those checks turning out to be bad becomes a big issue.
Why should anonymous actors still be privileged within the system? This isn’t 2010 where Bitcoin is just used for the Silk Road anymore. The ethos of allowing anonymous transactions to thrive has run its course. This isn’t my vision for the future of the internet and global financial system. I see it as inevitable and desirable where in the coming years those transacting in large amounts using crypto or blockchain are known to their counterparties.
Watch: Unbounded Capital’s Zach Resnick discuss why “BSV is Green Bitcoin” at CoinGeek Zurich
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