Bitcoin and Cryptocurrency Technologies

Figure 5.15 Forking attack.​A malicious miner sends a transaction to Bob and receives some good or
service in exchange for it. The miner then forks the block chain to create a longer branch containing a
conflicting transaction. The payment to Bob will be invalid in this new consensus chain.
For the attack to succeed, the forked chain must overtake the current longest chain. Once this occurs,
the transaction paying Bob no longer exists on the consensus block chain. This will surely happen
eventually if the attacking miner has a majority of the hash power — that is, if α > 0.5. That is, even
though there is a lot of random variation in when blocks are found, the chain that is growing faster on
average will eventually become longer. Moreover, since the miner’s coins have already been spent
(on the new consensus chain), the transaction paying Bob can no longer make its way onto the block
chain.
Is 51% necessary? ​Launching a forking attack is certainly possible if α > 0.5. In practice, it might be
possible to perform this attack with a bit less than that because of other factors like network
overhead. Default miners working on the main chain will generate some stale blocks for the usual
reason: there is a latency for miners to hear about each others’ blocks. But a centralized attacker can
communicate much more quickly and produce fewer stale blocks, which might amount to savings of
1% or more.
Still, at close to 50% the attack may take a long time to succeed due to random chance. The attack
gets much easier and more efficient the further you go over 50%. People often talk about a 51%
attacker as if 51% is a magical threshold that suddenly enables a forking attack. In reality, it’s more of
a gradient.
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