compounding

u/compounding


r/Bitcoin•

Every discussion about potential 51% attacks has a few people asking, "why would a pool with 51% of the mining power want to destroy their own business? It's not in their economic incentives to actually perform an attack".

Usually someone will bring up the fact that an attacker could short Bitcoin before the attack, perhaps even on margin and make up to 2-4x their investment when the price crashes as a result of the attack. However, a 2-4x gain is pretty small if you are talking about making millions of dollars in mining equipment worthless. You would need to have nearly that much invested in addition to your mining equipment, and if it didn't work out, you would lose a significant fraction

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