The Bitcoin Cash fiasco: a reorg or a 51 percent attack?
On May 15, 2019, Bitcoin Cash (BCH) implemented a system upgrade designed to support a number of scaling solutions. Shortly after the fork, there appeared to be a power struggle between miners looking to recuperate lost BCH, which became spendable after the upgrade. This has led to new debates over the centralization, security, and immutability of the BCH network.
Bitcoin: Securing the Network
This white paper investigates how the Bitcoin network will be sustained, especially as its incentive structure changes in coming years.In the coming decades the mining incentive structure of the Bitcoin network is set to shift from block rewards to transaction fees. For this transition to be effective, the network needs to remain robust enough to prevent a 51% attack, while continuing to facilitate transactions at a low cost. Once block rewards phase out, ARK Investâs research demonstrates that a transaction fee of 1.2% would be sufficient to incentivize the buildout of a network that is secure from an economically profitable 51% attack, regardless of bitcoinâs market cap and the capital allocation of a nefarious miner. This 1.2% fee would underpin other potential transactions in the Bitcoin network beyond the bitcoin currency, which could include real estate transfers, venture capital contracts, and machine-to-machine transmissions.
