👉👉👉 Are PoS networks really more expensive to attack than PoW?

The Cost Dynamics of Attacking PoS vs. PoW Networks: Insights from #BITMEX

Renting vs. Buying: Cost Dynamics

Attacking a PoW Network

- Controlling 51% of Bitcoin’s mining power costs about $2 billion annually, considering miners’ annual earnings of $10 billion and a 20% premium to entice them.

Attacking a PoS Network

- Controlling enough staked Ethereum costs around $1.2 billion annually, given #stakers ' earnings of $3 billion and needing only a third of the total stake to disrupt the network.

Comparative Perspective

- BitMEX notes that the cost to attack PoS and PoW networks is comparable when normalized for market capitalizations, challenging the belief that PoS is inherently harder to attack.

Permanent Threats: Buying and Building

PoW Networks

- Permanent attacks require buying and maintaining 51% of mining hardware, involving continuous billion-dollar expenditures over years.

PoS Networks

- Acquiring a third of staked Ethereum might cost around $100 billion, potentially triggering a market surge and making the attack counterproductive. It involves a significant one-time investment rather than ongoing expenses.

Confiscation Risks and Real-World Anchors

PoW Systems

- Mining hardware is vulnerable to physical confiscation.

PoS Systems

- Stakes can be moved across borders easily, reducing confiscation risks, as moving a private key is undetectable.

Vulnerabilities in Both Systems

- Both PoW and PoS have vulnerabilities: PoS networks could be destroyed by controlling significant stakes, while PoW networks might recover as mining hardware degrades.

Conclusion

BitMEX concludes that while PoS lacks a real-world anchor, making it potentially more susceptible to certain attacks, both PoW and PoS require strategic considerations for long-term security and stability.

Source - cryptopolitan.com

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