IT Pro is supported by its audience. When you purchase through links on our site, we may earn an affiliate commission. Learn more

Coinbase halts trading of Ethereum Classic after attack

A string of deep chain reorganisations led to over a million tokens double spent

Cryptocurrency exchange Coinbase has announced it will stop trading Ethereum Classic including transactions, withdrawals and deposits after a "deep chain reorganisation" occurred on the network on Sunday.

The reorganisation affected more than 100 blocks on the Ethereum Classic (ETC) network and could be caused by a 51% attack, among other possible explanations.

Coinbase said in a blog post that 88,500 ETC tokens were double spent (~$460,000) following the reorganisation of blocks. The trading platform updated the post later in the day following multiple detected deep reorganisations, many of which including double spends, increasing the total damage of those spends to 219,500 ETC (~$1.1m).

A 51% attack refers to the ability for an individual or group of miners that have majority control over a crypto's mining power to rewrite transaction history by taking tokens from transactions and then sending the same tokens to a different address on a new secret transaction history created by the attacker.

Other explanations put forward relate to Coinbase's nodes having been surrounded - the one Ethereum Classic advisor Cody Burns made.

The ETC Twitter account also claimed in a tweet, now deleted, that crypto miner manufacturer Linzhi could be behind the excessive hash rates which could have contributed to the reorganisation of blocks, due to it testing its new machines with a 1,400 Mh/s hashrate.

The claim was firmly denied by the manufacturer, which toldCoindesk "we are categorically denying such claims, they are entirely baseless and may be part of the attack itself."

While Coinbase users are completely locked out of doing anything with their ETC tokens, other exchanges have increased the number of confirmations required to process a transaction, a method of combat endorsed by ETC which is working with SlowMist, a Chinese blockchain security firm.

The more popular crypto Ethereum was born out of Etehreum Classic. The latter was created following a hack on the DAO which was a fundraising vehicle for the project and Ethereum was created to recover the lost funds from the hack.

Featured Resources

The state of Salesforce: Future of business

Three articles that look forward into the changing state of Salesforce and the future of business

Free Download

The mighty struggle to migrate SAP to the cloud may be over

A simplified and unified approach to delivering Enterprise Transformation in the cloud

Free Download

The business value of the transformative mainframe

Modernising on the mainframe

Free Download

The Total Economic Impact™ Of IBM FlashSystem

Cost savings and business benefits enabled by FlashSystem

Free Download

Most Popular

Why convenience is the biggest threat to your security
Sponsored

Why convenience is the biggest threat to your security

8 Aug 2022
How to boot Windows 11 in Safe Mode
Microsoft Windows

How to boot Windows 11 in Safe Mode

29 Jul 2022
Microsoft successfully tests emission-free hydrogen fuel cell system for data centres
data centres

Microsoft successfully tests emission-free hydrogen fuel cell system for data centres

29 Jul 2022