For the first time in Bitcoin’s five-year history, a single entity has repeatedly provided more than half of the total computational power required to mine new digital coins, in some cases for sustained periods of time. It’s an event that, if it persists, signals the end of crypto currency’s decentralized structure.
Researchers from Cornell University say that on multiple occasions, a single mining pool repeatedly contributed more than 51 percent of Bitcoin’s total cryptographic hashing output for spans as long as 12 hours. The contributor was GHash, which bills itself as the “#1 Crypto & Bitcoin Mining Pool.” During these periods, the GHash operators had unprecedented powers that circumvented the decentralization that is often held up as a salient advantage Bitcoin has over traditional currencies. So-called 51 percenters, for instance, have the ability to spend the same coins twice, reject competing miners’ transactions, or extort higher fees from people with large holdings. Even worse, a malicious player with a majority holding could wage a denial-of-service attack against the entire Bitcoin network.
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I would be more concerned if one single individual owned all the computers that contributed to the 51%, but as it stands, the pool owner would be hard pressed to convince the miners to mine off the beaten path, since, if I recall correctly, this pool uses standard mining software in pool mode. This means the software will be connected to both the pool and the larger bitcoin network, keeping the required chain colissions from occurring. There’s also the fact that mentioning this will encourage many contributing miners to change pools. Finally, 51% is only the minimum requirement for network takeover. It would take weeks, posably months if they are unlucky, to make a big enough chain to overtake the main chain. This gives people plenty of time to detect and block the offending pool connections. In any case, the fact that it is known keeps the potential for damage low.