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PR Newswire
08-11-2013, 09:31 AM
Well, I do understand how Bitcoin works, but I am not able to access the risks involved, till the following article...
‘Miners’ could devastate Bitcoin
LONDON — The Bitcoin virtual currency is vulnerable to an attack that could allow a group of “miners” to take control of the entire system, said a new report.
The success of the currency is predicated on the fact that it is decentralised and functions without the intermediation of any central authority. The calculations required to authenticate transactions are completed using a network of private computers. The operators of these computers, known as “miners”, are rewarded with transaction fees and newly minted Bitcoins.
Computer scientists at Cornell University have discovered a way for a group of miners to obtain more than their fair share of revenues and grow in number until they control more than 50 per cent of Bitcoin’s processing power. When this point is reached, the Bitcoin value proposition collapses, said the researchers.
“The currency comes under the control of a single entity; it is no longer decentralised; the controlling entity can determine who participates in mining and which transactions are (made), and can even roll back transactions at will,” researchers Ittay Eyal and Emin Gun Sirer wrote in a blog post.
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http://www.todayonline.com/tech/miners-c...te-bitcoin
‘Miners’ could devastate Bitcoin
LONDON — The Bitcoin virtual currency is vulnerable to an attack that could allow a group of “miners” to take control of the entire system, said a new report.
The success of the currency is predicated on the fact that it is decentralised and functions without the intermediation of any central authority. The calculations required to authenticate transactions are completed using a network of private computers. The operators of these computers, known as “miners”, are rewarded with transaction fees and newly minted Bitcoins.
Computer scientists at Cornell University have discovered a way for a group of miners to obtain more than their fair share of revenues and grow in number until they control more than 50 per cent of Bitcoin’s processing power. When this point is reached, the Bitcoin value proposition collapses, said the researchers.
“The currency comes under the control of a single entity; it is no longer decentralised; the controlling entity can determine who participates in mining and which transactions are (made), and can even roll back transactions at will,” researchers Ittay Eyal and Emin Gun Sirer wrote in a blog post.
...
http://www.todayonline.com/tech/miners-c...te-bitcoin
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