> Even worse, voting on updates is broken by design... a majority of participants could collectively decide to screw over a minority and simply steal their assets by voting in a code update.
Such is life though. It is not just ethereum. Bitcoin cannot survive a majority attack. In the long run, I can't see how even a government can survive a majority attack. One obvious solution to the problem is to try to prevent any one bloc from gaining majority status. I'm sure there are more elaborate solutions though and if any of them is elegant, I'd like to learn about it.
Governments might not be immune from a sustained majority attack, but that's the point... governments are large entities that (hopefully) operate at large timescales and have some degree of inertia and stability.
In turn, governments provide recourse and security for smaller, constituent systems (companies and individuals.) As long as the government remains intact (or intact enough), it can be a an arbiter and enforcer between the smaller entities (i.e, the entire legal system).
With Ethereum, there is no arbiter. There is only the exact code of the contract. It is entirely possible that the code is flawed in a way that is disadvantageous to all parties, such that they cannot change it, or that a mistake was made that allows one or more parties to act in violation of the "spirit" of the agreement.
Of course, some of these situations can be foreseen and accounted for (exit clauses, consensus code updates, etc.) But not everything can be foreseen, and the irony is that the more situations are explicitly accommodated for, the more surface area there will be for difficult-to-detect edge cases.
The legal system has built in resiliency, due to multiple fallback layers of (hopefully) impartial arbiters to add a layer of empathy and judgement on top of the strict letter of the law. It's not perfect, but it works.
Unless Ethereum can find some equivalent, I cannot see it taking over anything but certain types of very well-understood transactions. Don't get me wrong, that still has value... automated escrow, options & futures trading (etc.) is huge. But until this problem is solved, effective DAOs are a pipe dream.
This is true bitcoin cannot survive a majority attack. But the amount of resources needed to form a majority attack would be better used to just mine bitcoin.
Attacking the network for the sake of attacking it would be very expensive and would basically devalue BTC, which I'm assuming would remove any initial incentive.
In theory. Who said an attack would happen by allocating computing resources? That strikes me as https://xkcd.com/538/. Suppose that the majority of the miners are allied with a small number of organizations. People/organizations with sufficient influence can strike deals with those organizations to orchestrate a majority attack.
I suppose that's a matter of definition. I read "allocating computing resources" as "building/buying more hardware". That should indeed be unfeasible. But using social means to gather support from other people who have already allocated computing resources should be a lot more feasible.
Yeah, a lot more feasible but not less suicidal. The idea is that if miners were to band together to abuse their power and rig the system, the larger population would lose faith in Bitcoin's ability to accurately serve as an accounting mechanism, no longer value it, and Bitcoins would be worthless. Now the money the miners stole is worthless and their equipment is worthless. So it's suicidal for them to try to rig the system. They can't gain from it.
Such is life though. It is not just ethereum. Bitcoin cannot survive a majority attack. In the long run, I can't see how even a government can survive a majority attack. One obvious solution to the problem is to try to prevent any one bloc from gaining majority status. I'm sure there are more elaborate solutions though and if any of them is elegant, I'd like to learn about it.