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In January, there was worry in the bitcoin community that GHash, a mining pool. controlled a rising share (even greater than 50%) of the total bitcoin computational power used to mine the cryptocurrency. That apparently is a problem as it would allow GHash to exercise complete control over which transactions appear on the blockchain and which miners reap mining rewards.
GHash went over the 50% mark recently, and held that rate for a period of more than 12 hours, it became generally known on Friday. This was not well received. A well known bitcoin developer publicly sold 50% of his holdings in the cryptocurrency, and the price of bitcoin fell to the $550 mark. It was trading recently around $670. Previously, GHash said that it would not break the 51% mark. “Reaching 51% of all hashing power,” the company said in a release, “is a serious threat to the bitcoin community.” I contacted the firm, asking why they went over their prior promise. I’ll update this post if I hear back. A 51% attack is something you do willfully. So, GHash would have to want to behave badly. As Ars Techica reported recently, GHash was accused less than a year ago of “using its considerable hashing power to attack a gambling site.” As such we’re not dealing with an actor that we should implicitly trust.
