Yes, reading this thread is quite some work, so sometimes some details may be missed, but thanks for pointing it out as I could drop some merit for HeRetiK. I think this point is very relevant. I believe ETH was raised in 2014 from the ICO? There were already a lot of people with a ton of BTC in their hands, ETH was marketed all around the world like no coin before and it was dirt cheap for those who had already a lot of money, aka whales.
"Only require a fraction", but that fraction has to come from someone or a group of people. The bigger the group, the more likely it becomes public before the attack could be pulled off (defense could be prepared) and the guys literally have to liquidate somewhere between $6 billion and $18 billion while facing the risk of losing it all. I doubt there are a lot of Elon Musks who would be willing to spend $44 billion on a Twitter platform. Liquidating that amount would also hurt their remaining holdings. Then all the uncertainty whether it works out or not. War escalates, logistics gets worse and available resources for chip manufacturing decrease out of a sudden etc.
Now, I agree that the Ethereum and Bitcoin communities might be quite friendly at this point in time. But that doesn't mean that the Ethereum community don't already try to highlight all potential advantages of PoS over PoW to the public. And I personally find it quite unlikely that they wouldn't at some point also try to point out this potential "rival Goldfinger" threat, if the theory holds up. If nothing else, then at least in order to try to make the public feel more positively about PoS in relation to PoW.
To me it is not even about how friendly these communities can and want to coexist or not. I think the attack can't be pulled off without making it public beforehand and if that happens, I would expect resistance not only from the BTC community, but also from the ETH community to some degree. Wallets could be identified that are emptying billions of dollars. Don't forget that ETH has publicly known faces around the world and they would have to provide answers at conventions and what not. The uproar would be insane. I doubt that BTC whales would accept losing billions of dollars to an ETH holders attack. BTC's network value is around 4 times as high as ETH's network. If it becomes publicly known that an attack is planned, there is a chance that BTC whales will pool funds and fight back. They could approach ASICs manufacturers, miners, and they could say "if" the attack is pulled off, we will pool 10 billion dollars to defend against it in some creative way. There are many ways to raise the price for the ETH attackers and keep in mind that the ETH attackers need to liquidate in the first place.
I think you are right, but I do wonder: What can they even really do to stop customers from buying their ASICs? Even if the suppliers deny these costumers, what prevents the latter from just acquiring those ASICs through middlemen? Could they perhaps make their customers sign a contract not to participate in a 51% attack, or to sell them on to other buyers who will?
Well, since the attackers can just use a whole array of middlemen in principle, and since they can also in principle make it so that their mined blocks in an attack can't be traced back to them in the first place, it seems quite unlikely that such contracts would work, at least to me. What is your opinion on this?
Acquiring millions of ASICs through middlemen would again raise the price. The whole coordination, logistics, higher price per piece, timing, getting it from A to B. Involving a high number of middlemen would make things only worse for the attackers and I am still absolutely convinced that simultaneous orders of ASICs that amount to the hash power of a potential 51% attack would definitely not go undetected. Then. the question remains whether ASIC manufacturers would dig their own hole by destroying POW and essentially their own gold mine.
Here's the thing, though: I don't really see why they would need to keep it a secret. I could be wrong, of course; I'm by no means an expert on legal matters. I just go by what I have read in this blog post:
https://sites.duke.edu/thefinregblog/2022/12/28/legal-liability-of-a-51-goldfinger-cryptocurrency-attack, which argues that a 51% attack might not even be illegal, in the sense that it might not prosecutable in a court of law. (I definitely think that this is worth discussing more, however.)
If that is indeed the case, then it seems that the more rumors there are about the build-up of the attack, the better it would actually be for the ETH investors, as it might just make BTC investors migrate preemptively, which would only make the cost go down, in theory. (This is of course assuming that they can indeed communicate successfully to the public that PoS is still safe, and that they can thereby convince some of the now uncertain BTC investors to migrate to ETH instead).
Ok if we assume that they make the attack public (or not), and they destroy 50% of BTC's value, which is around $650 billion, what do you think would the backlash be from all the relevant authorities? What would the consequences be for the cryptocurrency ecosystem from the SEC, CFTC, politicians, all relevant authorities around the world? Do you think they would say "well, there is a currency war and that's awesome". I think they would rigorously regulate every cryptocurrency out there because they can finally pretend to have a good reason. The consequences would be devastating and there would be investigations for sure. Whether they would be justified or not, but investigations would take place. ASICs providers would be probed whether they knew that the equipment would be used for an attack or not. If really $650 billion go down the toilet and the planning is of that magnitude as you described with middlemen and an attack coordination, I am sure heads would be rolling in one way or another.
Short selling is under thorough scrutiny all the time and market manipulation is as well. If an attack were to be announced and the market gets into turmoil afterwards, I doubt all authorities would accept that. Then the coordination itself involving billionaires and the ASIC manufacturing industry (you literally need the entire industry because of the sheer volume), I just can't see how that would be pulled off without consequences. It's not how the legal world works these days. Maybe for banks, but not for the crypto industry which is a target for many authorities anyway. If bringing BTC to its knees is expected to make another group of people of the same ecosystem rich, it doesn't make a lot of sense to me.
And all of that ignores the fact that ETH could be attacked in a similar way. POS is not a flawless security model and in order to attack it, the attackers would not have to buy a shitload of ASICs and the network is only 1/4th of the value.