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Blockchain's public, immutable ledger keeps things secure. Until it can not anymore. This is a 51% attack on the Ethereum Classic blockchain that has incurred losses of more than $ 1 million while undermining the currency's legitimacy.
Indeed, crypto exchanges are frequently victimized by theft, digital currencies struggled to shed their dark web origins. Although today's perilous digital environment could be found, the tokens themselves have come to be incredibly resilient to theft and misuse. Cryptocurrency market security amidst high volatility and regulatory uncertainty after 2018 in which prices plunged.
It is immune from tampering as long as no single entity controls more than half of the network's computing power. However, it is possible for a single user to achieve this power, and a hypothetical 51% attack on major cryptocurrencies like Bitcoin and Ethereum is often discussed in crypto circles.
Indeed, as Avivah Litan, at Gartner cybersecurity expert, notes, "the 51 percent attack is a real threat, which is why users should only trade in the crypto that has substantial hashpower."
In other words, the most likely people are gaining control of the network.
Unfortunately, they can be more than half of the network's computing power, allowing them to be multiple times. According to CCN, this ability is "generally directed against cryptocurrency exchanges." This process, colloquially known as a "reorganization" of the blockchain, is what's currently being experienced by ETC.
Although it is considerably less than Ethereum, Ethereum is still one of the most prominent digital currencies available, with a recent market cap of about $ 480 million. The most recent breach was detected by SlowMist, a Chinese security firm, which relayed the information via Twitter. In addition, the popular crypto exchange Coinbase, which also posted its initial findings to Twitter on Jan. 7, is investigating the attack.
In a subsequent blog post, Coinbase flagged fifteen cryptocurrency transactions and twelve of those included "double spends" – where the digital currency was spent twice – that exceeded $ 1 million in total. It said that no Coinbase accounts were impacted by the attack, however.
Once crypto exchange, Gate.io, admitted that it is lost funds, identifying seven rollback transactions on their network. In their official statement, "Gate.io will take all the loss for the users." Other services, including those by Binance and Bitrue, were also targeted in the attack.
ETC's official Twitter account has posted the attacker's address as they work to recover the funds.
This is a new version of this article, with a focus on the Proof of Work (PoW). Donald McIntyre, a member of the ETC development team warned that "the question is going to recovery in the medium or long term is plausible or if the network, unless it grows significantly, is perpetually vulnerable, therefore unusable."
Many in the blockchain community, to be different from the consensus algorithm, Proof of Stake, will be more efficient and secure.
Miguel Palencia, CIO at Qtum, at blockchain that markets "Proof of Stake" model, explained that "solutions such as Proof of Stake are not only less resource-intensive and more difficult to fall victim to 51% attack. "
The attacker would need to buy more to the coins currently being staked, which would raise the market price exponentially, render the attack useless and extremely costly. "
For users to feel secure, cryptocurrencies will be able to demonstrate that they are implementing the best practices and the most protected methods for guarding their tokens. This event was not as costly as it could be. It could turn out that $ 1.1 million could be a small price to pay for that reminder.
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