Hacked Bitcoin Gold Blockchain with 51% attack, exchanges lose USD $ 18.6 million
The cryptocurrency market in general has been affected by several continuous attacks.
A malicious miner successfully executed a double spend attack on the Bitcoin Gold network at the end of last week, causing the Bitcoin Gold (BTG) currency to succumb to a network attack during that period of time.
Bitcoin Gold communications director Edward Iskra first warned users about the attack on May 18, and explained that a malicious miner was using the exploit to steal funds from the cryptocurrency exchanges.
To execute the attack, the miner acquired at least 51% of the total power of the network, which gave them a temporary control of the chain of blocks. Obtaining this large amount of resources is incredibly expensive, even in a smaller network, such as Bitcoin Gold, but it can be monetized through its use along with a double-spending attack.
After gaining control of the network, the attacker began depositing BTG in the cryptocurrency exchanges while trying to send those same coins to a wallet under his control. In general, the Blockchain would solve this by including only the first transaction in the block, but the attacker could revert the transactions since they had the majority control of the network.
As a result, they were able to deposit funds in the exchanges and withdraw them quickly, after which they invested the initial transaction so that they could send the coins they had originally deposited in another wallet.
A Bitcoin Gold address involved in the attack received more than 388,200 BTGs since May 16 (most of the transactions were sent to itself). Assuming all these transactions were associated with the double-spending exploit, the attacker could have stolen as much as USD $ 18.6 million in mutual funds.
The last transaction was sent on May 18, but the attacker could, in theory, try to resume it if he still has access to enough hash power to gain control of the blockchain.
The Bitcoin Gold developers advised the exchanges to address the attack by increasing the number of confirmations required before the deposits to customers' accounts. Blockchain data indicates that the attacker invested successful transactions in up to 22 blocks, prompting developers to recommend raising the confirmation requirements to 50 blocks.
Currently, Bitcoin Gold is ranked 27 in the cryptocurrency ranking, with a working capital of 766 million US dollars and a unit value of USD $ 45.03. The fall of yesterday was 6.85% and compared to last week of 20.86%. However, its decline coincides with a generalized decrease in cryptocurrencies. For example, Bitcoin fell 6.69% compared to yesterday and 11.27% compared to the previous week.
Bitcoin Gold is at least the third cryptocurrency network hit with a major attack in the last week. Verge was one of those affected, as we explained in this article. Previously, the Japanese crypto currency Monacoin was hit by an apparent retention block after a miner won up to 57% of the network's hashrate.
The market in general has had a descent: 96 of the 100 main currencies are in low, in the majority of the cases have descended in 20% or more in relation to last Thursday.