ZenCash (now Horizen) Suffers a 51% Attack Resulting in Significant Losses

Summary #

On June 2, 2018, ZenCash, now known as Horizen (ZEN), fell victim to a 51% attack. During this attack, the perpetrator managed to double-spend ZEN coins by gaining control of a majority of the network’s hashrate. The attack lasted several hours and resulted in an estimated loss of approximately 23,000 ZEN, which was equivalent to about $550,000 at that time.

Attackers #

The identity of the attacker or attackers who conducted the 51% attack on the ZenCash network remains unknown. The suspect pool address is znkMXdwwxvPp9jNoSjukAbBHjCShQ8ZaLib. The suspect exchange deposit adress is zneDDN3aNebJUnAJ9DoQFys7ZuCKBNRQ115

Losses #

The attackers managed to double-spend approximately 23,000 ZEN coins during the attack. At the time of the attack, this amount was worth around $550,000. The ZenCash community and the exchanges that were targeted suffered the losses, as the value of ZEN also experienced a dip after the attack.

Timeline #

• June 2, 2018: The 51% attack on the ZenCash network began. The attackers gained control of a majority of the network’s hashrate, which allowed them to mine blocks at an accelerated rate.
• June 2, 2018: The ZenCash team became aware of the attack and issued a warning to exchanges and mining pools, advising them to increase the number of confirmations required for ZEN transactions.
• June 6, 2018: The ZenCash team released a post-mortem report, detailing the attack and the steps taken to mitigate such incidents in the future.

Security Failure Causes #

• Availability of Hashing Power for Rent: The attacker likely used a hashpower marketplace to rent the mining power necessary for the attack. This practice lowers the cost and complexity of performing a 51% attack as attackers don’t need to purchase and set up mining hardware.
• Slow Response: Though the ZenCash team responded to the attack, there was still a window of time during which the attacker could exploit the network.
• Exchange Vulnerabilities: Exchanges did not require a sufficient number of confirmations for deposits, making them vulnerable to double-spend attacks. Following the attack, many exchanges increased the number of confirmations required for ZEN deposits.