The crypto community has seen all kinds of fraudulent activities. And there is nothing strange in that. Cryptocurrencies are still considered something new, which opens up endless possibilities for both investors and hackers.
On one hand, digital assets attract traders from all walks of life, including institutional ones. This means that tons of money are invested in various cryptocurrencies on a daily basis. On the other hand, bad actors are standing in front of a golden mine. The technologies underpinning the tokens are all different and new, which means security is having its flaws. It is ten years since Bitcoin took on its wild journey in the world of crypto assets and for the time being fraudsters have come up with several ways to steal it.
Probably the most popular way to steal cryptocurrencies is through an exchange hack. One just have to breach the security measures and allocate as much tokens as possible to his or her wallets. This could happen through phishing or DDoS as well. Cryptojacking is another form of winning tokens, though it has nothing to do with stealing them. Instead hackers infect websites, which force visitor’s devices to mine certain cryptocurrency as send the reward to the bad guys.
However, in the last few weeks we have witnessed that another threat is rising – 51% attack. Potentially extremely profitable, 51% attacks have been relatively mild so far.
What is a 51% attack?
It occurs when one person or a group of persons takes control over the majority of the blockchain’s specific hashrate. In other words, if a group of miners controls over 50% of the computing power needed for Bitcoin’s running it can do quite interesting things like reversing transactions and double spending coins. The bandits would also be able to get all the rewards from other miners, relocate funds, halt transactions and prevent other miners from creating a new block.
Nevertheless, it is extremely difficult to conduct such an attack. What’s more, it is expensive, though it depends on your target. Usually, the larger the blockchain the pricey the attack. For example, conducting a 51% attack on Ethereum Classic might cost you between $55 million and $85 million. Why? Because you need powerful mining rigs. They, in turn, consume tremendous amounts of electricity, so yes purchasing miners and paying your bills can actually make you drop the idea. The prices for Bitcoin and Ethereum are a staggering $550,000 and $360,000 per hour respectively.
What about smaller networks?
Einsteinium is the cheapest currency with only $77 per hour. However, the profits will be so small that it’s not worth even considering attacking it. Bytecoin and Bitcoin Private would cost you $600 per hour on average.
All being said, we have to note that so far every 51% attack has been caught on time. Meaning the hackers managed to run away with just bits of the token supply. This makes us think that 51% attacks are just not worth the hassle.