The War On Shitcoins Episode 8: Bitcoin Private (BTCP). The war on shitcoin is a series of Crypto.IQ that targets and breaks down cryptocurrencies that are not worth investing in either because they are scams, have serious design flaws, are centralized or, in general, are simply useless copies of other criptovalute. There are thousands of shitcoins who are ruining the markets and Crypto.IQ intends to expose them all. The crypted space needs an exorcism and we are happy to provide it.
Bitcoin Private (BTCP) is one of the many Bitcoin forks, but is perhaps one of the best known forks. Bitcoin Private (BTCP) launched in March 2018 and in April, briefly reached a market capitalization of $ 1.5 billion. However, Bitcoin Private (BTCP) is a good example of how market capitalization is an insufficient measure of the legitimacy or utility of a cryptocurrency.
In October, a hacker streamed a 51% attack against Bitcoin Private (BTCP) for fun, using the hash power chartered from a cloud mining site. It has now come to light that the Bitcoin Private developer team coined an extra 2.04 million BTCP during the genesis fork and hid this from the public. Essentially, Bitcoin Private (BTCP) is a shitcoin because it lacks security and has corrupt developers, as we will explain in this article.
Someone could attack 51% of Bitcoin Private (BTCP)
A hacker using the pseudonym "Geocold" wanted to demonstrate to the world how easy it is to attack a cryptocurrency at 51%, even a cryptocurrency with a market capitalization of over 50 million dollars at the moment, one like Bitcoin Private (BTCP).
Perhaps Geocold was inspired by Crypto51, a website that calculates how convenient it is to perform a 51% attack on various cryptocurrencies. Currently, Bitcoin Private is still extremely vulnerable to a 51% attack because the total network hash rate is seven MH / s and uses the equihash algorithm.
Crypto51 indicates that it only costs $ 48 to 51% of Bitcoin Private (BTCP) attack for an hour, so perhaps for under $ 200 a hacker could perform a prolonged and devastating attack that would decimate Bitcoin Private (BTCP). It seems that most of the major exchanges removed the Bitcoin Private (BTCP) after the initial Geocold livestream, but several exchanges still offer Bitcoin Private (BTCP), which is a real disservice to their customers and puts the exchange itself at risk.
The Geocold livestream The 51% attack of Bitcoin Private (BTCP) has caused a media frenzy in cryptographic space. Many thought it was illegal to attack a cryptocurrency, and indeed Twitch and Stream.me have banned Geocold's account. Geocold obtained 62.5 percent of the Bitcoin Private (BTCP) hash rate and successfully performed block mining and was ready to execute the double-expense attack, but only stopped because it lost its account streaming.
As we have already said, anyone with a knowledge of $ 50 and a bit of programming can perform a 51% double-charge attack with Bitcoin Private (BTCP). Geocold was making cryptographic service a service by exposing this truth. In general, people should do research before investing or exchanging a cryptocurrency to make sure it is actually safe. In this case, Bitcoin Private (BTCP) obviously lacks security, but still has a market capitalization of tens of millions of dollars and hundreds of thousands of dollars of daily trading volume.
The developers of Bitcoin Private (BTCP) have secretly pre-printed 2.04 million coins
The fact that Bitcoin Private (BTCP) can be attacked so easily makes it a shitcoin, but the revelation that the developers secretly extracted 2.04 million BTCP during the genesis fork is the nail in the coffin.
The idea behind Bitcoin Private is that it is Bitcoin integrated with the Zclassic privacy technology (similar to Zcash). This means that there are stealth addresses and transparent addresses. The developers used this to their advantage, they coined 2.04 million BTCP and hid it in invisible addresses. In addition, the developers have released verification checks for the BTCP supply that intentionally lost the hidden prize.
It's been more than 9 months since Bitcoin Private was launched, and this has only been discovered now. The total supply of Bitcoin Private (BTCP) should be 21 million coins like Bitcoin, but there are already 22.6 million existing BTCPs and continuous mining.
It seems that 300,000 BTCPs from hidden prizes were unloaded on the market between July and August, coinciding with a $ 10 to $ 3 price collapse. It is estimated that these BTCPs downloaded from the hidden prizes have compensated developers between $ 1 million and $ 3 million, while at the same time the total capitalization of the BTCP market lost over $ 100 million.
There is nothing to prevent developers from downloading the other 1.74 million BTCPs they have in the not so hidden pretexts. The market is reacting to this revelation and the price of the BTCP has dropped to $ 2. If the developers were to actually cash this premium all at once, it would completely saturate the orders and lower the price of the BTCP to almost zero.
Even at this lower price, the market capitalization of Bitcoin Private (BTCP) exceeds $ 40 million. This makes no sense for a cryptocurrency that can easily be attacked at 51% by any script kiddie, while at the same time the market could be sucked at any time by corrupt developers.