Introduction On Bitcoin's Security # Bitcoin's breakthrough was solving the double-spending problem using a Proof⁠-⁠of⁠-⁠Work (PoW) mechanism (see whitepaper). Bitcoin remains secure as long as honest miners control the majority of the network's computing power. The reverse situation is known as a 51% attack, which can manifest in different ways: [1] Double⁠-⁠spending by rewriting recent history. A double-spending attack in Bitcoin happens when someone tries to spend the same coins twice. If they control more than half the network’s mining power, they can create a secret version of the blockchain that removes a payment they already made. When they reveal this version, it replaces the original, canceling the first transaction and letting them keep the coins. [2] Censoring transactions, e.g., blacklisting addresses. With majority control, an attacker can choose to ignore or exclude certain transactions from blocks. This means they can selectively prevent transactions from or to specific addresses or entities from being confirmed, effectively censoring them from the network. [3] Halting the network by producing empty blocks only. The attacker can choose to create blocks without any transactions — just the coinbase reward — thus preventing regular transactions from being processed. This can stall the entire Bitcoin network, degrade usability, and cause widespread disruption. Honest miners not participating in such an attack have their blocks orphaned, meaning the network does not recognize them as part of the valid chain. Their work becomes useless and they won't get any rewards. Security in Bitcoin isn't free The term "security budget" in Bitcoin refers to the total amount of money paid to miners to secure the network. Approximately every 10 minutes, miners are paid to keep the network safe — this is the security budget. It consists of: [1] Block subsidy (newly minted BTC) [2] Transaction fees Miners earn rewards through block subsidies and transaction fees, but t