Bitcoin's security is not based on its price, it is based on the fact that
compromising the system's security is compute-intensive - same as with every
other cryptosystem.
Even if the total resources deployed on the Bitcoin network were to someday
fall to such a low level that a single attacker could easily produce a
forged chain of transactions, that would only mean that this attacker could
double-spend their own coins from that point onwards, not that they could
nullify the established chain that was already in existence and accepted by
all nodes on the network.
Also, if participation in the network fell that far, then this could only
mean that the aggregate value of the currency had already fallen similarly
far as well, and so at that point, Bitcoin would have already failed, from a
market-acceptance perspective. So, no one would care at that point that its
security was compromised.
Bitcoin is based on public-key signatures and SHA-256 hashes, so, as long as
Bitcoin's popularity doesn't fall so far as to make a double-spending attack
feasible, to compromise it in some more serious fashion in the meantime
(forging transactions from other users, for example) would require breaking
these well-established tools, which (unless weaknesses are discovered in
them) requires some astronomical number of years.
-Mike
On Sat, Jun 18, 2011 at 9:11 AM, Warren Smith <warren....@gmail.com> wrote:
> On 6/18/11, Mike Frank <michael.patrick.fr...@gmail.com> wrote:
> > Bitcoin has experienced up-and-down fluctuations in value by more than
> 40%
> > quite regularly. It dropped by more than 50% just last week. Yet, the
> > longer-term trend is still that its value (and the computing power
> devoted
> > to it) is increasing at more than 2x per month (10x per calendar
> quarter).
> > The bitcoin network has grown by 10x for each of the last 6 consecutive
> > quarters, and currently does it more ops/s than the Top 500
> supercomputers
> > put together!
> >
> > For any particular group of "bad guys" to collaborate with each other to
> > command more than 50% of this amount of computational power for any
> > significant length of time (sufficient to corrupt the chain) seems like
> an
> > extremely unlikely proposition to me - especially in light of Jameson's
> > point. Any putative attackers would profit more by mining bitcoins
> > cooperatively with the system.
> >
> > I therefore find Bitcoin's security guarantees to be quite convincing...
> >
> > -Mike
>
> --good grief. "Proof of security" by looking at a graph of gold
> prices versus time.
> ("It seems to be going up despite severe fluctuations.") I'll stay
> with old fashioned notions of cryptographic security, thank you... I
> see no need for this kind of "advance
> of the field."
>
--
Full name: Michael Patrick Frank
Email addr.: michael.patrick.fr...@gmail.com (pers. email)
Snail mail: 820 Hillcrest Ave., Quincy, FL, 32351-1618
Phone/voicemail: (413) 842-6670 (main number, uses Google Voice)
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