51 percent attack

51 percent attack51 percent attack happens when an individual miner or group of miners takes control of more than 50% of the network's computing power. Controlling over half of the network gives the attackers the power to disrupt the network. That is usually achieved by renting mining hash power from a third party.

How a 51% Attack Works

Bitcoin and other cryptocurrencies are based on blockchains, a form of a distributed ledger. These digital files record every transaction made on a cryptocurrency's network and are available to all users—and the general public—for review. As a result, no one can spend a coin twice. (So-called "private blockchains" introduce permissions to prevent certain users in the general public from seeing all the data on a blockchain.)

As its name implies, a blockchain is a chain of blocks, which are bundles of data that record all completed transactions during a given period. For bitcoin, a new block is generated approximately every 10 minutes. Once a block is finalized or mined, it cannot be altered since a fraudulent version of the public ledger would quickly be spotted and rejected by the network's users.

However, by controlling the majority of the computing power on the network, an attacker or group of attackers can interfere with the process of recording new blocks. They can prevent other miners from completing blocks, theoretically allowing them to monopolize the mining of new blocks and earn all of the rewards.