51 Percent Attacks

A 51 percent attack occurs when an entity gains control of more than half of a blockchain network's mining hash rate or staked capital. With this majority power, the attacker can dominate the consensus process, allowing them to reverse their own transactions and create a double-spend scenario.

They can also prevent other transactions from gaining confirmation, effectively halting the network or censoring specific users. This attack is particularly effective on smaller networks with lower security budgets where acquiring majority control is economically feasible.

It undermines the trust model of the entire ecosystem, as the immutable nature of the ledger is temporarily suspended by the attacker. In the context of derivatives, such an attack can be used to manipulate oracle data feeds, leading to incorrect liquidation prices.