How Does a ‘Sybil Attack’ Threaten a Decentralized Cryptocurrency Network?
A Sybil attack occurs when a single malicious entity creates and controls numerous fake identities or nodes to gain a disproportionate influence over the network's consensus process. This can be used to vote on malicious proposals or block valid transactions, compromising the network's integrity and decentralization.
Glossar
Disproportionate Influence
Concentration ⎊ Disproportionate influence arises from the inherent token-weighted nature of most Decentralized Autonomous Organizations, where capital concentration directly translates into governance power.
Sybil Attack
Architecture ⎊ The Sybil attack, within cryptocurrency, options trading, and financial derivatives, exploits the inherent design vulnerabilities of distributed systems reliant on identity-based consensus.