Explore why small cryptocurrencies are vulnerable to 51% attacks, see real‑world examples, understand the economics, and learn practical mitigation steps.
51% Attack: What It Is, How It Works, and How to Guard Against It
When talking about 51% attack, a situation where a single actor controls more than half of a blockchain’s mining or staking power, letting them rewrite transaction history. Also known as majority hash attack, it directly challenges blockchain consensus, the rule‑set that decides which blocks are valid. The attacker’s edge comes from dominating the hash power, which lets them produce conflicting blocks and pull off double‑spending attacks.
The 51% attack is one of the most talked‑about threats in crypto because it strikes at the heart of decentralization. Its main attribute is the required proportion of network power – anything over 50% gives an attacker the ability to outpace honest miners. In practice, the value translates to a massive rental of ASICs or a large stake purchase. For example, the 2018 Bitcoin Gold breach saw attackers rent roughly 900 mining rigs, pushing their share to about 55% of the network’s hashrate and enabling them to double‑spend $18 million worth of coins.
Consensus mechanisms shape how a 51% attack can happen. In Proof‑of‑Work (PoW) systems, an attacker needs majority hash power; in Proof‑of‑Stake (PoS), the same principle applies to stake ownership. The attribute “required resource” therefore shifts from computational effort to token holdings. Values differ: PoW attacks often involve costly hardware rentals, while PoS attacks may involve buying large token bundles, as seen in the 2019 Ethereum Classic incident where a single entity acquired enough stake to reorganize the chain for several hours.
Mitigating a 51% attack relies on spreading power and adding safety nets. Decentralization incentives, such as mining pool caps and stake distribution programs, reduce the chance of any one actor reaching the critical threshold. Technical safeguards like checkpointing – hard‑coded block references that cannot be overwritten – add a layer of finality. Hybrid consensus models, where PoW and PoS coexist, also raise the cost of a successful takeover. Network security therefore requires a mix of economic and protocol‑level defenses.
Below you’ll find a curated set of articles that dive deeper into each of these aspects: from tax‑friendly jurisdictions and exchange reviews to real‑world case studies of 51% attacks. Whether you’re a trader, developer, or just curious about blockchain safety, the collection gives you practical insights and actionable steps to stay ahead of the threat.