Quote from: Warren on June 14, 2011, 02:23:47 AM

Couldn't the 51% be raised, to say 95% instead?

There is no way that any single entity/organization could ever have 95% of the computing power of the network...

By design, Bitcoin's "true" block chain is not determined by voting (say 95%) but by "proof of work", the chain with more "proof of work" wins. This is a probabilistic issue. Another way to see it, is as a competition issue. The team that dominates 50%+ of the power can outperform the rest.

If you own more than 50% of the hashing power, you will probably be able to produce the longest chain measured in CPU power (you will beat the rest more times in the mining lottery). If you are not honest, you will mess the whole network, until the honest guys regain control. That does not mean you will own the chain, or that you can do a long term damage to the chain, but you can cause a lot of trouble in the meantime, especially if you can sustain the attack for a long time. Think about if you could not trust the confirmations you get after doing a transaction. This would damage the confidence in the network.

That is an unresolved weakness in the Bitcoin paradigm, in my opinion.

EDIT: More related links:

If an attacker gets more than 50 % of mining power
http://forum.bitcoin.org/index.php?topic=24996.0;all

POLL: What are the most likely things that may cause bitcoin to fail ? (merged thread)
http://forum.bitcoin.org/index.php?topic=25026.0

My Response to Ben Lauries Last Word on Bitcoin
http://forum.bitcoin.org/index.php?topic=25760.0