Ethereum Classic suffers three consecutive 51% attacks

Summary #

Ethereum Classic, a well-known cryptocurrency, experienced a series of three 51% attacks in August 2020. The attackers reorganized over 14,000 blocks and managed to double-spend ETC coins.

Attackers #

The identity of the attackers behind the Ethereum Classic 51% attack remains unknown.

Losses #

During the Ethereum Classic 51% attack, it was reported that the attackers took home more than $9 million in double spend transactions. This loss was borne by crypto exchange OKEx; platform users did not endure any loss due to OKEx’s user-protection policy.

Timeline #

• August 1, 2020: The first of three 51% attacks on the Ethereum Classic network begins. Over 3,000 blocks are reorganized. Developers deny that any reorganization has occurred.
• August 5, 2020: Bitquery announces that the attacker double-spent over 800,000 ETC, an equivalent of about $5.6 million. The attacker paid 17.5 BTC, or $204,000, obtain enough hash power for the attack.
• August 6, 2020: The second 51% attack on the Ethereum Classic network begins. Over 4,000 blocks are reorganized. Despite the attacks, the price of ETC only fell by less than 1%. OKEx considers delisting ETC, pending security improvements.
• August 29, 2020: The third 51% attack on the Ethereum Classic network begins. Over 7,000 blocks are reorganized. OKEx sees a loss of over $9 million. The price of ETC falls 4%. The confirmation time for ETC transactions is delayed to two weeks.

Security Failure Causes #

• Network Support Discontinuance: Ethereum Classic digital currency miners withdrew their support for the network after each 51% attack. With less hash pointed at the ETC network, it is easier for hackers to 51% attack the network.
• Proliferation of hashing power marketplaces: NiceHash and other hashing power marketplaces allowed attackers to easily rent hash power for short periods of time to gain control of the network’s transaction validation process.