In the wake of three high profile mining-related attacks on notable alt-coins, one can't help but wonder: is the window for bootstrapping a new proof-of-work cryptocurrency closed? If not, it must be getting close. (For reference, see attacks on: Verge, Bitcoin Gold, Monacoin).

The default failure mode for any new cryptocurrency in 2018 is the sound of silence. For a coin to be attacked, first someone has to care enough to try. It's likely no one will. For the sake of this discussion, we'll assume we're talking about a coin that's getting some traction: it's listed on some exchanges and has some notable trade volume.

Launching a new PoW cryptocurrency there are, broadly speaking, two choices when it comes to choosing a hashing algorithm:

Choosing an existing hashing algorithm used by other coins Creating a novel hashing algorithm by tweaking or combining existing ones

There are lots of variations on these two themes. Verge, for example, got cute and allowed miners to use any one of five different algorithms to produce blocks- a "feature" exploited by its attacker. For the most part, though, a project will fall into one of these two buckets. Let's examine the issues with each.

Using An Existing Algorithm

The problem with choosing an existing hashing algorithm, one used by an established cryptocurrency, is obvious: your fledgling chain is immediately susceptible to a 51% attack from existing miners. Those miners likely have warehouses full of ASICs churning out hashes 24/7. Even a handful of those machines, if diverted toward your chain, could destroy your network. And, as Charlie Lee pointed out recently, there is no real incentive that prevents them from doing this.