The Bitcoin community has been in a full state of outrage recently as the Bitcoin mining pool Ghash.io crossed the 51% estimated hashrate distribution share. This sparked a fierce debate over mining centralization and the principle of a decentralized currency that has spilled over to the mainstream media with Bloomberg and Business Insider declaring that the worst fears have come to pass.
Peter Todd, a core bitcoin developer, announced that he would be selling 50% of his bitcoins, citing concerns over mining centralization and justifying his public announcement by stating that a non-public sale might amount to insider trading.
Emin Gün Sirer, a hacker and professor at Cornell University with more than 25 years experience in distributed systems and other computer science fields, recently called for a full-on Hard Fork arguing that the 51% share gained by Ghash.io is indeed really Armageddon because “GHash is in a position to exercise complete control over which transactions appear on the blockchain and which miners reap mining rewards.” He suggests that coding changes to the protocol must be made so as to fully disincentivize pool mining.
Even Gavin Andresen, the Chief Scientist at the Bitcoin Foundation, has joined the ongoing uproar with a public post titled “Centralized Mining ” which many found to be lacking as it did not provide any reassurance but instead reiterated that: “Bitcoin is still a work in progress, and you should only risk time or money on it that you can afford to lose.”
The debate has taken a new turn today as Ghash.io became unavailable for unkown reasons. Although the website was still accessible due to their CloudFlare protection, mining itself seemed to be affected and miners were not able to access their statistics.
When users visited Ghash.io, there was a brief 502 error which would then redirects to an old and non-live version of the website. A banner at the top stated:
“This page (https://ghash.io/) is currently offline. However, because the site uses CloudFlare’s Always Online™ technology you can continue to surf a snapshot of the site. We will keep checking in the background and, as soon as the site comes back, you will automatically be served the live version.”
Ghash.io has not yet replied to requests for comments, but bitcoiners speculated that Ghash.io was DDos-ed due to ongoing concerns over their share of hashrate distribution. Many bitcoiners seemed to welcome the possibility of a DDos and one bitcoiner wondered whether he should join, while others asked for more calm.
In a recent press release in January this year Ghash.io stated that they would not cross the 51% threshold as it would undermine their investment. Despite this public assurance, Ghash.io did cross the 51% threshold which might have been seen as a red line by individuals who might be capable of carrying out a Distributed Denial of service attack, but it is not yet known why the pool was down, whether it was a DDos, or who was DDos-ing them.
In a recent post on CCN.com, DDos-ing was suggested as a possible line of defense against a 51% attack. However, there have been no precedents of such DDos attacks in response to the share of hashrate distribution. As such, the effectiveness of a DDos attack was not clear. It is still too early to tell, but Ghash.io’s share of hashrate distribution stood at 38% over the past 24 hours prior to what seems to have been a DDos. It then went down to as low as 6% and has now stabilized to approximately 27%.
Although the decrease in hashrate may only be temporary, the DDos may act as a warning, not only to Ghash.io but to all pools who may gain too great a share of the hashrate distribution to the point where the decentralized nature of bitcoin is placed in danger as it is likely that income would have been lost during the DDos period which may cause miners to reconsider whether they wish to partake in a pool that seems to be at the frontline of criticism.
Further updates will be provided as the story develops. If you have any information in regards to this article feel free to contact the author at [email protected]. Of course, the author promises to keep the information provided private and confidential.
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