Dr. Craig Wright is setting the record straight regarding many Bitcoin technology misnomers. One of his recent examples of separating fact from fiction is the role of hash power in securing the blockchain network.
Explaining complicated information to readers is not always easy. There are certain levels of knowledge required to understand how the design of Bitcoin works. The article explains in layman’s terms how much of the entrenched dogma surrounding hash power misconstrues Bitcoin’s core design principles.
Like many others, I incorrectly thought the amount of hash rate has the essential qualities of a security feature warding off a 51% attack on the blockchain. As Dr. Wright points out, a rogue block reward miner could recreate the entire hash rate of Bitcoin from its birth until the end of 2017 with 50% of the current BTC hash rate in only a matter of weeks.
To put that into perspective, at no time during the eight years did a significant portion of the community feel Bitcoin was unsecured based on the lower hash rate levels.
The number of public and private entities supporting the blockchain network has grown in size over the past few years. The community is still no match for a rogue government, which can quickly marshal enough hash power resources to launch a sustainable and profitable attack.
Dr. Wright explains that Bitcoin is secure because the hashes are publicly and widely distributed. The security of Bitcoin lies in the transparent nature of the blockchain itself, since supporters involved within the network can easily detect any attack.
A distributed system of commercial nodes operates the network. These entities act as a trustee, controlling and ensuring the integrity of the Bitcoin network without ever owning it. They follow a set of stringent rules and processes in return for a payment.
In the event of an attack, during an aging process, any node attacking the network can be determined and isolated. Nodes cannot claim blocks found as revenue and spend until they are further than 100 blocks old. Transaction processors and good-faith actors will then have enough time to respond and enact controls to contain any attack.
Dr. Wright also states unequivocally that there is “no irreversible hash function that cannot be controlled in Bitcoin.” If an individual node fails or is attacked, the other nodes will take over as showed previously. Dr. Wright explains further how he was able to build resiliency and wherein the white paper he initially discussed time-stamping and what defines a node.
Since hash power is not a security mechanism, what benefit does it have? Hash power shows the node’s fitness and investment into the blockchain network. It’s a demonstration that you have the essential interest of Bitcoin at heart. Dr. Wright designed Bitcoin in a manner that forces it to scale. Hash doesn’t make it more secure.
Read Dr. Craig Wright’s latest blog post, Nodes, Hash Rate, and Signalling.
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