Direct from the desk of Dane Williams.
Single Monero mining pool closes in on 51% of network’s hashrate.
The largest Monero mining pool, MineXMR, continues to build on its distribution of the network’s hashrate.
Checking the following live Monero pools table, you can see that the single pool has now hit 47.5%:
If it reaches 51%, the pool would technically be able to pull off a 51% attack on the Monero network and wreak some serious havoc.
What is a 51% attack?
A 51% attack is when a single entity gains control of a majority of a network’s computing power.
This allows the attacker or associated group to double-spend the cryptocurrency by choosing which blocks to process.
Essentially, they’re printing money for themselves.
When it comes to talking about 51% attacking a network, you can’t do it without looking at Ethereum Classic.
On networks like ETC, these attacks happen embarrassingly often.
But while 51% attacks are commonplace on smaller networks, they are almost impossible to pull off on larger networks such as Bitcoin.
When you consider how much computing power it would take to amass the hashrate required, you can see why the current decentralisation of the Bitcoin network makes it so prohibitively expensive to pull off.
They don’t call Bitcoin the most secure network in the world for nothing.
What this means for Monero (XMR)
But bringing things back to the issue at hand, let's take a look at what this at least could mean for Monero.
When it comes to Monero, XMR’s position as the leading privacy coin actually adds an extra layer of intrigue to this story.
The security of this particular network is paramount to the entire industry, not just those invested in the coin.
If the Monero network remains vulnerable to a 51% attack, then it won’t matter if Monero can be traced or not.
All of the privacy advantages gained from using Monero over Bitcoin will be mute because the network will be able to be controlled by a single actor.
Whether MineXMR has good or bad intentions doesn’t matter.
All that matters is that they have the technical ability to take full control of the network and all transactions conducted on it.
What next for Monero (XMR)?
The final question for Monero now becomes why do miners continue to deploy their hash power to MineXMR and not spread it around?
Well, a common misconception is that by joining a large pool, you stand a bigger chance of finding a block and therefore will earn more.
But unfortunately this is not the case.
Not to mention that if the network is compromised in this way, then it doesn’t matter anyway!
This is what makes the fact they are even allowing themselves to amass close to the 51% hashrate required to pull off an attack so scary.
Monero being 51% attacked by MineXMR has the potential to rock the entire privacy coin space and even flow into the entire crypto industry as a whole.
Whether you’re a Monero (XMR) holder or not, watch this space.
Best of probabilities to you.
Update: MoneroXMR hashrate drops below 40%
Less than 24 hours after the MineXMR mining pool was nearing the critical 51% hashrate, we can see the community has rallied:
Under 40% now!
And with that, Monero is no longer at risk of being 51% attacked by MineXMR.
Really, any time that the Monero hashrate approaches even 40%, the community needs to come together and decentralised the pools.
I'd take it a step further and say that even the top 5 pools shouldn't have the combined hashrate to potentially collude.
Whether any pool says they're not a bad actor should be irrelevant.
The risk is just not worth it.
Hopefully this will be used as a lesson on the dangers Proof of Work blockchains always face and the Monero community will continue to work towards decentralising their network.
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Has there ever been a successful 51% attack? I know that it's been talked about quite often and I don't think I have seen anything closer than what you showed in this post.
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51% attacks happen quite regularly on smaller PoW blockchains.
Networks like ETC, BTG, BSV always face the threat and are regularly hit.
I'll let you Google these chains for some details.
As for Bitcoin, the network is too large and its hashrate too well distributed to be hit.
It's just too expensive for a bad actor to garner the resources to generate the hashrate required to pull it off.
Finally moving back to Monero, what makes this one so interesting to me is that while Monero is technically just another relatively small network, in reality is represents so much more.
As the leading privacy coin, Monero is essentially acting as a case study for crypto moving to the next level.
In my opinion, the fungibility that privacy coins like Monero offer is going to play a key role in the mainstream adoption of crypto over fiat.
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Wouldn't imagine this could be a problem until now! Worrysome indeed, it would be like a shotnin the foot: best privacy coin, completely centralized.
As an update, it looks like the Monero community has come together and reallocated their mining pools.
MineXMR has now moved to under 40% of the total hashrate.
Great to see!
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BEER.I saw there was major concerns about the 51% attach on Monero. It does show the issue with proof of work now though. Imagine when people stop mining Ethereum and how one major building of GPU miners could honestly take over one of these smaller chains pretty easily. Pools also pretty much negate the decentralization nature of crypto. Personally I think Proof of Work is getting slowly replaced.
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I've honestly never considered it, but of course they're likely to just move to another network.
The mining infrastructure is there, why wouldn't they?
Yikes!
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Mining pools are a larger threat to POW than any other bad actor out there. I just hope people come to their senses and start using the smaller ones to even it out.
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Have you seen the idea of a P2Pool?
I'm starting to go down the rabbit hole of how they can limit some of the PoW centralisation risks like what we've seen here.
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Han. Out of the loop for quite some time on XMR. I'll look into it for sure.
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