51% Attack

What Is a 51% Attack?

A 51% attack refers to an attack on a blockchain—such as Bitcoin, for which such an attack is still hypothetical—by a group of miners controlling more than 50% of the network's mining hash rate or computing power.

The attackers would be able to prevent new transactions from gaining confirmations, allowing them to halt payments between some or all users. They would also be able to reverse transactions that were completed while they were in control of the network, meaning they could double-spend coins.

They would almost certainly not be able to create new coins or alter old blocks. A 51% attack would probably not destroy Bitcoin or another blockchain-based currency outright, even if it proved highly damaging.

Key Takeaways

  • Blockchains are distributed ledgers that record every transaction made on a cryptocurrency's network.
  • A 51% attack is an attack on a blockchain by a group of miners who control more than 50% of the network's mining hash rate.
  • Attackers with majority control of the network can interrupt the recording of new blocks by preventing other miners from completing blocks.
  • Changing historical blocks is difficult due to the hard-coding of past transactions into Bitcoin software.
  • Although a successful attack on Bitcoin or Ethereum is unlikely, smaller networks are frequent targets for 51% attacks.

How a 51% Attack Works

Bitcoin and other Proof-of-Work cryptocurrencies are based on blockchains, a form of a distributed ledger. These digital files record every transaction made on a cryptocurrency's network and are available to all users—and the general public—for review. As a result, no one can spend a coin twice. (So-called "private blockchains" introduce permissions that limit access to the blockchain to specific users.)

Each block is a bundle of data that records all completed transactions during a given period. For Bitcoin, a new block is generated approximately every 10 minutes. Once a block is finalized or mined, it cannot be altered since a fraudulent version would quickly be spotted and rejected by the network's users.

However, by controlling the majority of the computing power on the network, an attacker or group of attackers can prevent other miners from publishing blocks, theoretically allowing the attackers to monopolize block rewards and reject unwanted transactions.

Bitcoin

For Bitcoin, the reward is currently 6.25 newly-created bitcoins, though it will eventually drop to zero. In the event of a successful attack, the attackers could block other users' transactions, or even reverse transactions. This vulnerability, known as double-spending, is the digital equivalent of a perfect counterfeit and the basic cryptographic hurdle the blockchain was built to overcome. So a network that allowed for double-spending would quickly suffer a loss of confidence.

Changing historical blocks—transactions locked in before the start of the attack—would be extremely difficult even in the event of a 51% attack. The further back the transactions are, the more difficult it would be to change them. It would be impossible to change transactions before a checkpoint, where transactions become hard-coded into Bitcoin's software.

On the other hand, a form of a 51% attack is possible with less than 50% of the network's mining power, but with a lower probability of success.

Despite the name, it is not necessary to have 51% of a network's mining power to launch a 51% attack. However, such an attack would have a much lower chance of success.

51% Attack Examples

Major cryptocurrencies, such as Bitcoin or Ethereum, are extremely unlikely to suffer from 51% attacks due to the prohibitive cost of acquiring that much hashing power. For that reason, successful 51% attacks are limited to smaller cryptocurrencies with more limited mining networks.

The type of mining equipment is also a factor, as ASIC-secured mining networks are less vulnerable than those that can be mined with GPUs. Cloud services such as NiceHash make it possible to launch a 51% attack using only rented hash power, especially against smaller, GPU-only networks.

For example, in May of 2018, Bitcoin Gold, at the time the 26th-largest cryptocurrency, suffered a 51% attack. The malicious actor or actors controlled a vast amount of Bitcoin Gold's hash power, such that even with Bitcoin Gold repeatedly attempting to raise the exchange thresholds, the attackers were able to double-spend for several days, eventually stealing more than $18 million worth of Bitcoin Gold. Bitcoin Gold was hit again in 2020.

Also in 2020, Ethereum Classic, a smaller offshoot of the smart contract blockchain, suffered from three separate 51% attacks in a single month. Ethereum founder Vitalik Buterin suggested that this was a disadvantage for PoW networks, indicating that a Proof-of-Stake network would be less vulnerable.

Another Bitcoin clone, Satoshi Vision (BSV), suffered an attack in August 2021.

51% Attack vs. 34% Attack

The tangle, a distributed ledger used in cryptocurrencies such as IOTA, could theoretically succumb to an attacker deploying over a third of the network's computing power. This is referred to as a 34% attack.

How Likely Is a 51% Attack Against Bitcoin?

A successful 51% attack is considered extremely unlikely, due to the prohibitive cost of assembling enough hash power and electricity to hijack the network. As of April 2022, the Bitcoin hash rate is nearly 220 Exahashes per second, meaning that it would take around ten thousand of the most advanced mining rigs to launch a successful attack. Any party capable of such an attack would likely have more to gain by honest mining and collecting block rewards.

How Can Networks Prevent a 51% Attack?

There are several ways to mitigate the danger of a 51% attack, although the risk cannot be entirely eliminated by proof-of-work networks. A successful 51% attack becomes significantly more expensive for cryptocurrencies that use ASIC miners, provided that no larger cryptocurrency is mined by the same algorithm. Bitcoin Cash introduced a system of ten-block checkpoints, making transactions irreversible after a certain period of time. Other cryptocurrencies have attempted to secure their networks using ASIC miners, ChainLocks, or changes to the consensus algorithm.

Can Ethereum Be 51% Attacked?

A successful 51% attack against Ethereum is unlikely, for the same reasons given above for Bitcoin. Although Ethereum is a smaller network, it is still too large to make an easy target for a 51% attack. Moreover, this risk is likely to disappear as Ethereum transitions to a proof-of-stake network.

Article Sources

Investopedia requires writers to use primary sources to support their work. These include white papers, government data, original reporting, and interviews with industry experts. We also reference original research from other reputable publishers where appropriate. You can learn more about the standards we follow in producing accurate, unbiased content in our editorial policy.
  1. Bitcoin.org. "Some Bitcoin Words You Might Hear."

  2. CoinDesk. "What Is a Block Reward?"

  3. NiceHash. "Official Statement Regarding the Latest 51% Attack Allegations."

  4. Bitcoin.com. "Bitcoin Gold Hacked for $18 Million."

  5. CoinDesk. "Attempted 51% Attack on Bitcoin Gold Was Thwarted, Developers Say."

  6. CoinDesk. "Crypto Investors Have Ignored Three Straight 51% Attacks on ETC."

  7. CoinDesk. "BSV Suffers 51% Attack."

  8. BitInfoCharts. "Bitcoin Historical Hashrate."

  9. BitMex. "Bitcoin Cash ABC's Rolling 10-Block Checkpoints."

Take the Next Step to Invest
×
The offers that appear in this table are from partnerships from which Investopedia receives compensation. This compensation may impact how and where listings appear. Investopedia does not include all offers available in the marketplace.
Service
Name
Description