Analysis

Bitcoin Community Abuzz Over Ghash.io’s Uncomfortably

Jayanand Sagar | June 8, 2014 | 9:55 am
Analysis

Bitcoin Community Abuzz Over Ghash.io’s Uncomfortably

Jayanand Sagar | June 8, 2014 | 9:55 am

Fears of a potential 51 percent attack are once again brewing in the bitcoin community with news that mining pool Ghash.io has reached an uncomfortably high hashrate in the past twenty-four hours.

The bitcoin subreddit on social sharing website Reddit.com, with over ten shares on the page related to the matter.

The pool’s hashrate reached as high as 47 percent — extremely close to the 51 percent envelope that would open the door to attacks that could be carried out by the majority.

One such attack would be double-spending transactions. That is, using the same amount of bitcoin twice. Such an occurrence could have devastating consequences in the community, so it’s no surprising that members are urging others to distance themselves from Ghash.io and move to another pool.

“Ghash.io at 47% hashrate for the last 24 hours. PLEASE move to another pool if you can,” exclaims one submission on Reddit. A fellow user’s comment was voted the top saying it really isn’t that easy:

“People need to understand that simply telling people to move pool isn’t enough. This is economics, the larger miners (and the only ones that actually matter) are not going to move unless there is economic incentive . It is vital we give these miners reason to decentralize via pushing P2P or better competition.”

[ot-video type=”youtube” url=”https://www.youtube.com/watch?v=6luEMwSAS0I”]

This isn’t the first time fears of a 51 percent attack have loomed on the community.

Earlier this year, the community encountered a similar situation, equally met with as much hysteria as we’re seeing this weekend.

The news prompted Ghash.io to issue a statement on the matter at the time, in which the pool said:

“GHash.IO will take all necessary precautions to prevent reaching 51% of all hashing power, in order to maintain stability of the bitcoin network.”

They added that, “[their] plans are to expand the bitcoin community as well as utilise the hashing power to develop a greater bitcoin economic structure.”

“If something happened to Bitcoin as a whole it could risk our investments in physical hardware, damage to those who love Bitcoin and we see no benefit from having [a] 51% stake in mining.”

Ghash.io has not yet issued a statement on this occasion.

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