Author: Billy Tetrud 2021-05-24 20:28:41
Published on: 2021-05-24T20:28:41+00:00
The Bitcoin community needs to determine how much security it requires before deciding on trade-offs that reduce security for other goals. It is important to consider the level of attack the community wants to be resilient to, which depends on the size of Bitcoin and its value. The more valuable Bitcoin becomes, the more damaging and valuable an attack would be for attackers. An upper limit on the amount that could be allocated to attack Bitcoin would be 5% of the US federal budget, which is almost $5 trillion/year. This would take massive political cooperation and wheeling and dealing, but it seems possible. An upper limit on China's government attack is $720 billion per year.To figure out a reasonable lower bound for how much it takes to attack Bitcoin, we need to consider a 51% attack. An attacker would need to buy about 25% of the existing mining power, which is about 40 exahashes/second. If an attacker bought 400,000 WhatsMiner M30S+ rigs at current market price, they would need $1 billion to buy them all. A lower bound on the cost of attack is $1.5 billion, while an upper bound on the US government attack is $72 billion.It is not super clear if reducing Bitcoin's security is "enough" yet, and more accurate analysis is needed to determine tighter bounds on the cost of attack and likely attack budgets. The security will go up with price, and if Bitcoin goes up by 10x, that's nearly 10x the security. It seems possible that the community currently has enough security, but it is likelier that it does not. Before talking about whether to reduce security to save costs, the community needs to determine how much security it needs and how much security it has. Without good estimates with confident bounds, an informed decision cannot be made to reduce security. An attack would affect all Bitcoins regardless of what transactions they do or do not take part in.
Updated on: 2023-06-14T22:06:44.735197+00:00