Author: Corey J. Mahler, Esq., J.D., LL.M.

Bitcoin continues to be an issue on the Right, so let me go over a few facts:

1. The Bitcoin system is eminently vulnerable to certain kinds of attacks — most relevantly, a majority attack (we’ll call it, for the sake of clarity and convenience).
2. The safety mechanisms built into the Bitcoin system are meaningless and ineffective in the face of a majority attack.
3. A majority attack would be, admittedly, expensive to execute, but not prohibitively expensive.
4. China was widely recognized as controlling 60+% of the mining capacity of the system back in 2021.
5. It would be difficult (if not effectively impossible) to calculate China’s total percentage control of the Bitcoin system (in terms of nodes, not ‘coins’).
6. An actor with a majority control over the Bitcoin system (again, in terms of nodes, not ‘coins’) could effectively seize control of the entire system. This would, in fact, be trivial to accomplish.
7. The required investment to control a majority of nodes in the Bitcoin system would be something in the range of $20–30B.
8. The current Chinese economy is just shy of $20T.
9. $20B is 0.1% of $20T.

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A Majority Attack
A majority attack against the Bitcoin system would consist of gaining control over a majority of the nodes in the system (this can be accomplished simply by investing in hardware). An actor (almost certainly a State actor) in possession of a majority of nodes could simply:

1. reject all blocks or transactions from minority nodes (i.e., those not under the control of the attacker),
2. create its own version of the transaction history,
3. force this version to be accepted as correct or canonical, and
4. make it impossible for minority nodes to form an alternative consensus.

This is not even particularly complicated.

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Notably, all of this is essentially, once sufficiently abstracted, just fairly basic game theory.