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51% Attack

51% Attack

What is a 51% attack?

A 51% attack is an attack on a proof of work blockchain where a group of miners controlling more than 50% of the network’s mining hash use this power to prevent new transactions from being confirmed or reverse transactions that were completed under their control, leading to a double-spend attack. Once this happens, there is nothing written into the blockchain technology that can stop the attack. However, the biggest cost resulting from a 51% attack is the loss of confidence in the blockchain.

Has a 51% attack happened before?

In August 2016, two ERC-20 tokens, Krypton and Shift, fell victim to 51% attacks. As a result, Krypton moved KR from an Ethereum-based proof of work blockchain to a Bitcoin-based proof of stake blockchain.

In July 2016, the mining pool GHash.io briefly exceeded 50% of the bitcoin network’s mining hash rate, resulting in the pool voluntarily committing to reducing its share of the network. In a statement following the event, “Bitcoin pool GHash.io commits to 40% hashrate limit after its 51% breach.”

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