At press time, bitcoin has jumped beyond $8,600, meaning the currency has incurred a $500 spike in the last 24 hours. Naturally, everything is looking good for the currency right about now, but would it be possible for bitcoin to still wind up in the gutter, and if so, when?
Could Bitcoin Fall Into a Dismal State?
According to MIT’s Cory Fields and former Block Stream CTO Greg Maxwell, bitcoin is still something of an “experiment.” They acknowledge that it’s been around for roughly ten years and are impressed by how long it’s lasted, but they also say that it’s very much a “baby” when compared with other financial tools available to American investors, and believe the currency isn’t as strong as some might claim.
As it would seem, 51 percent attacks are a major fear among most crypto traders. These attacks occur when a company controls more than half of bitcoin mining operations; thus, enterprises like Bitmain have been at the center of many of these concerns, but Maxwell says 51 percent attacks aren’t terribly possible in the bitcoin world. He comments:
I think people obsess far too much about 51 percent. There’s some sort of attractive mystery to them that distracts people. If you’re worried that someone might reorder history using a high hash-power collusion, just wait longer before you consider your transactions final.
Instead, Maxwell says bitcoin is at a much bigger risk if its voting system is ever changed. Should this occur, bitcoin could potentially become more centralized, and Maxwell believes this would be very dangerous to the ecosystem. He explains:
A far bigger risk to bitcoin is that the public using it won’t understand, won’t care, and won’t protect the decentralization properties that make it valuable over centralized alternatives in the first place. [A] risk we can see playing out constantly in the billion-dollar market caps of totally centralized systems. The ability demonstrated by system[s] with fake decentralization to arbitrarily change the rules out from under users is far more concerning than the risk that any expensive attack could allow some theft in the case of over-eagerly finalized transactions.
A Few More Worries
Fields, on the other hand, takes a very different approach in his arguments. He believes bitcoin’s blockchain could find itself suffering from some sort of fatal bug that may ultimately cause devaluation in the currency or even produce other, albeit phony, bitcoins. He mentions:
There was a bitcoin cash bug that I found and disclosed, and it kicked off a discussion about responsible disclosure in these systems and how to do it generally. I was a little smug for a few months until we were affected by a similar bug in bitcoin core which potentially would allow for money printing out of thin air.