Definition
A “51% attack” (also known as a majority attack) is a potential security breach in blockchain-based cryptocurrencies, where a single actor or group gains control over more than 50% of the total computing power (hashrate) of a cryptocurrency blockchain network. This computational dominance allows the attackers to manipulate the blockchain’s consensus mechanism, compromising the integrity and trustworthiness of the system and potentially injecting malicious activities into the network.
Actions Performed by Malicious Actors:
Here are some of the malicious actions 51% attackers can perpetrate:
- Double Spending: The attackers can exploit their control to spend the same cryptocurrency coins or tokens in multiple transactions, effectively defrauding legitimate recipients by reversing or replacing transactions after they have been confirmed.
- Block Withholding (Selfish Mining): The attackers can decide to withhold mined blocks from the public blockchain, causing miners to lose all rewards from those blocks. Instead, they secretly mine a separate chain. Once the secret chain becomes longer than the public one, they release it, invalidating the original chain and causing a chain reorganization.
- Block Modification: With the majority hashrate, the attackers can modify blocks at will, including modifying transaction details or excluding certain transactions, leading to disruptions, invalid transactions and chaos in the network.
- Preventing Confirmations: The attackers can selectively block or delay specific transactions from being confirmed, leading to significant slowdowns and disruptions in the network’s functionality.
When a group gains control of more than 50% of a cryptocurrency network’s hashing power, it is known as a 51% attack. These assaults take place on smaller crypto networks, but because larger networks like Bitcoin are more secure, they frequently fail there.
