What’s special about >50% is that you’re guaranteed to succeed, eventually, no matter how many blocks are waited. But this result assumes you are in control indefinitely and doesn’t tell you how long it will take – and of course, the time it takes is random so if you only control the hashrate for a few hours you’re not guaranteed success. The greater your hashrate, the less time required / the greater the probability of success in a given time. It’s definitely not simply “if the merchant waits 10 minutes, the attacker should control >50% for 10 minutes”.

So, for the highly unlikely scenario that someone control >50% for a limited amount of time, the amount of time waited is the primary contributor to security. For the much more likely scenario that someone controls ~10% for an extended period of time, number of blocks is the relevant parameter.

To think of it another way, let’s take this to the extreme. Imagine if I designed a coin that targets block confirmations periods of 1 year. Let’s call that YearCoin. Do you still claim that 1 Bitcoin confirmation is as secure as 1 YearCoin confirmation? It took the whole network a year to find a YearCoin block! Once that block was found, how easy would it be for someone to double spend a transaction in that block? Wouldn’t you agree that a YearCoin block confirmation is a ton more secure than a Bitcoin block confirmation?

Of course there’s nothing “wrong” with Litecoin, it’s basically Bitcoin but with a different hash function. This kind of understanding of fundamentals is just an example for what separates those who have what it takes to create a successful cryptocurrency from those who don’t.

To the extent that both GPU-friendly and CPU-friendly mining have their place, they needn’t be in separate currencies – see for example https://bitcointalk.org/index.php?topic=46423.msg555485#msg555485

“We were impressed by the convenience of SolidCoin’s fast transactions. Although we know that fast confirmations are not necessarily as secure as Bitcoin’s slower confirmations, they are very convenient for small merchants who don’t need transactions to be super secure. The average Litecoin block takes 2.5 minutes, one quarter of Bitcoin’s 10 minutes. So if merchants wanted to be as safe as Bitcoin, they can wait for 4 times the number of Litecoin confirmations as compared to Bitcoin.”

Unless I’m mistaken, there are no flaws in this statement (assuming equivalent ratio of honest nodes/attackers).

I think of all the work that went into creating Bitcoin. First there’s Satoshi, a man who by all accounts is a master of economics, probability, programming and network architecture. He devised an innovative design and spent years implementing it in an airtight way. He attracted brilliant developers to continue working on it technically and visionary entrepreneurs building businesses around it. It is still an uphill battle to get it accepted socially and economically. And that’s when there was a Bitcoin-shaped niche to fill.

And then there’s some schmo who thinks that by changing 5 lines of code and adjusting some design parameters he understands nothing about, he has created something that deserves to be even a blip on Bitcoin’s radar.

One day, there will have been identified several potential weaknesses in Bitcoin as well as features which may better suit different markets. Educated people who understand Bitcoin’s functionality and the challenges it faces will propose changes, but for some of them not manage to obtain consensus. They will gather and thoroughly think through a design for a new cryptocurrency which diverges fundamentally from Bitcoin. They will toil on implementing it and spend their time and money promoting it and building complementary services. It will experience the growing pains typical of a startup currency, but it will stand a chance competing with Bitcoin, and may find its place either supplementing or dethroning it.

This day has not yet come.

@Ron Gavriely – Since bitcoin is money, you can also donate it too

http://www.worldcommunitygrid.org