Bitcoin network is a ticking time bomb: Crypto analyst
- Bitcoin security budget is not sustainable and BTC chain becoming a Proof-of-Stake network could result in an attack, says analyst.
- Ethereum does not face this issue according to the crypto analyst Anthony Sassano.
- John Galt, head of strategy at Stride Zone disagrees, says Bitcoin social layer is strong enough to resist a 51% attack.
Bitcoin (BTC) blockchains runs on the Proof-of-Work (PoW) consensus mechanism. Critics have slammed the network for its energy usage and when faced with a similar challenge, Ethereum (ETH) moved to a Proof-of-Stake (PoS) mechanism.
Market participants speculate how the security of the BTC network will be affected by a similar move and whether the Bitcoin blockchain is strong enough to resist an attack.
Can Bitcoin resist a 51% attack?
Anthony Sassano, a crypto trader and analyst commented on the Bitcoin network’s ability to tackle a 51% attack, said BTC does not have a sustainable security budget to navigate such a situation. A 51% attack is an event in which a malicious entity, a group of miners or an individual gains control of over 50% of Bitcoin network’s mining hash rate.
Sassano blames lack of a sustainable security budget for Bitcoin’s inability to resist an attack that could emanate from a move to the Proof-of-Stake (PoS) consensus mechanism. Ethereum moved to the PoS mechanism through its major upgrade, the Merge, however the foundation has a security budget to tackle the challenges that arise from an attack on the blockchain.
More people need to understand that the Bitcoin network is quite literally a ticking time bomb.
— sassal.eth/acc (@sassal0x) September 21, 2024
This is not "fud" (read Dom's tweet) - this is just the reality of a chain not having a sustainable security budget.
Fortunately, Ethereum does not have this issue. https://t.co/8GYE7CRYzy
John Galt, Head of Strategy at Stride Zone, a liquid staking protocol disagrees with Sassano. Galt says that the social layer of the Bitcoin blockchain is strong enough to resist a 51% attack and even as block rewards decline, there is an incentive to secure the blockchain.
The social layer, or miners, users and community are expected to step in during an attack and foil it by denouncing the malicious entity, thereby safeguarding the network.
This isn't true, because the social layer of Bitcoin is strong enough to resist a 51% attack.
— John Galt (@lurkaroundfind) September 21, 2024
-Block rewards continue to fall, but tx fees mean that there's always an incentive to secure the chain with at least some hash power
-But at a certain point, hash power drops low…
The scenario discussed by the analysts applies to a 51% attack and a Proof-of-Stake chain, this does not apply to Bitcoin unless a malicious entity gains large scale control of the mining power.
At the time of writing, Bitcoin trades above $63,000.
Author
Ekta Mourya
FXStreet
Ekta Mourya has extensive experience in fundamental and on-chain analysis, particularly focused on impact of macroeconomics and central bank policies on cryptocurrencies.
