Bitcoin Cash underwent its halving on April 8th, 12:19 pm UTC, and most of its fears came true.
After the 630,000 blocks mined on the Bitcoin Cash network, hours later the hash rate and profitability dropped significantly in the charts, and the market fundamentals fell in line with everything that was expected in our previous report.
With the collective drop of both difficulty and hash rate, the security of Bitcoin Cash’s network was inadvertently under the scanner and Longhash recently revealed the statistics regarding the cost of attacking BCH and BTC network at the moment.
The current concern was regarding a 51% attack, and Crypto51.app – a website that tracks the cost of orchestrating such a hack on a token’s blockchain. The website obtains the data by conducting calculation on the cost of renting mining power to take over a particular blockchain, which is based on the expenses with respect to renting computational power via NiceHash.
Data from the website suggested that, at this particular moment, the cost of attacking Bitcoin Cash’s network for 1 hour is around $9,130, which had a hash rate of 1,891 PH/s.
In comparison, the cost of attacking Bitcoin’s network is staggeringly high at $555,948 per hour which is roughly 6090% higher. Attacking Ethereum would take a significant amount which is about $120k per hour.
Bitcoin SV, who underwent its 1st halving on 9th April, had a relatively higher cost, in comparison to BCH, of $9,945.
So is Bitcoin Cash really under a state of extreme jeopardy?
The short-term answer is Yes.
The long-term answer could be entirely different.
At the moment, Bitcoin Cash’s network is definitely under a state of panic and the vulnerability concerns are legitimate by the community.
However, the mining scenario for BCH with the drop in difficulty will eventually change. The functionality of BCH’s DAA algorithm is such that a block needs to be mined every 10 minutes. With BTC becoming more profitable to mine, some miners are trading their hash power, which will indirectly increase the time of blocks mined to 10.5 – 11 minutes. Such a change will be accommodated by the DAA and a drop in difficulty will be observed.
With the drop in difficulty, it will require less electricity and less hardware to mine BCH blocks, and since fees don’t matter, miners would eventually come back to BCH mining, after a state of stability is attained. Hence, once the storm passes, the profitability of mining BTC and BCH could possibly go back to where it was before the halving.
If Bitcoin Cash’s network is able to avoid a 51% attack in the next 20-30 days, the fifth-largest asset may end up avoiding these security concerns altogether.