But one is Proof of Work and the other is Proof of Stake
Correct. And the cost to attack a decentralized Proof of Stake decentralized network like Ethereum will actually be more than the cost to attack a decentralized Proof of Work network like Bitcoin. Not only would the attackers have to acquire sufficient Ethereum, they will also have to set up validators. The price of Ethereum will shoot up as they try to accumulate a sufficient number of ETH. The ultimate cost would be more than what is required to develop / build enough ASIC miners to take over 51% of the Bitcoin hashrate.
Here's a link where it is discussed. I think the numbers are off and conservative.
Proof Of Stake also has the added benefit of using less energy.
https://www.bitcoinsensus.com/51-percent-attack-cost-ethereum/Cost to Attack Ethereum Network Higher than Bitcoin’s, Say ResearchersRevealing the True Cost of Compromising Blockchain Integrity: Insights from CoinMetrics
CoinMetrics’ research highlights the impracticality and high financial barrier to executing a 51% attack on Bitcoin and Ethereum.
An attack on Bitcoin could cost over $20 billion, while compromising Ethereum would exceed $34 billion, making these attacks economically unfeasible.
Despite concerns about Liquid Staking Derivatives (LSDs), the study shows they cannot be leveraged for network attacks, reinforcing the security of these blockchains.
According to recent findings by CoinMetrics, an on-chain analytics firm, carrying out a 51% attack on the Bitcoin and Ethereum blockchains would not only be exorbitantly costly but also unprofitable and ineffective. These insights shed light on the robust security measures underpinning the two largest cryptocurrencies by market capitalization.
Understanding the 51% Attack ThreatA 51% attack, a potential threat in blockchain technology, involves a group of miners or entities gaining control of more than half of a network’s mining hash rate in Proof-of-Work (PoW) systems, or nodes in Proof-of-Stake (PoS) settings. This control could, theoretically, allow them to manipulate network transactions and double-spend coins. However, the size and strength of a network play a pivotal role in its security, making larger networks like Bitcoin and Ethereum less vulnerable to such attacks.
CoinMetrics’ research, led by Lucas Nuzzi, the head of research and development, quantifies the Total Cost to Attack (TCA) for both Bitcoin and Ethereum. The findings reveal that an attack on Bitcoin would require the purchase of approximately 7 million ASIC miners, a venture that could exceed $20 billion, significantly outweighing any potential gains from the attack. This cost estimation takes into account the market’s reaction to such a large-scale acquisition of ASICs.
The Prohibitive Costs of Attacking Bitcoin and EthereumSimilarly, targeting Ethereum would be even more costly, estimated at over $34 billion. This figure is based on Ethereum’s current metrics, including its price, the total amount of staked ETH, and the number of validators. The complexity of carrying out such an attack on Ethereum is further compounded by its PoS mechanism, which has a churn limit preventing the immediate deployment of a large amount of stake, extending the time required for an attack to over six months.
Another aspect explored in the study is the potential risk posed by Liquid Staking Derivatives (LSDs), such as those offered by staking services like Lido and RocketPool. Lido, which controls a significant portion of staked ETH, poses a theoretical risk to Ethereum’s network security. However, Nuzzi clarifies that leveraging LSDs to manipulate block templates is not a viable strategy for attackers.
LSDs and Network Security: Dispelling the MythsThe research concludes that the costs associated with carrying out a 51% attack on either Bitcoin or Ethereum far outweigh any potential benefits. This economic disincentive, coupled with the technical challenges involved, makes such attacks highly improbable and reinforces the security and resilience of these leading blockchain networks. The findings provide reassurance to investors and participants in the cryptocurrency ecosystem about the robustness of these digital currencies against potential threats.
