In the parallel universe of Ethereum Classic, the DAO saga continues with the DAO hacker, whose IP may have recently been identified, converting almost 100,000 ETC into 144.92992187 bitcoin, worth almost $100,000.
According to chain analysis by Bok Consulting, the hacker divided 106,100 ETC into smaller amounts of approximately 2,333 ETC in different addresses, then sent them to Shapeshift for conversion. We tried to reach out to shapeshift representatives for comments, but have not received a response in time for publishing.
Shapeshift is somewhat unique as it requires no identification whatever for currency exchanges. Through an online website, you simply choose what currency to convert, automatically receiving funds without shapeshift having any information about yourself. It is not clear, therefore, whether the funds can now be tracked further, with the hacker potentially escaping unscathed with $100,000 and perhaps more.
Around 3.5 million ETC remains in the hacker’s main address, worth around $3.5 million. If the hacker, therefore, escapes with what may be a test run, he might continue further draining the account, placing immense pressure on ETC’s price which fell at some point today by more than 7%.
While ethereum took a collective decision with overwhelming consensus in favor of preventing the theft through a hardfork, some, mainly anonymous users, decided to continue giving the hacker’s coins some value. The currency quickly gained a speculative price at the beginning, with Berry Silbert, Coindesk owner and Bitcoin Investment Trust manager, together with Chandler Guo, a bitcoin and ethereum miner, publicly supporting the coin.
However, after a near unanimous show of unity by Ethereum project developers, the currency began to quickly lose value as traders rushed for the exit. It continued to slide further, with the currency now worth less than a dollar.
There has been some speculation regarding potential connections between ETC developers, who largely remain anonymous save for Elaine Ou and perhaps Charles Hoskinson who joined later, as the hacker sent some ETC to Ethereum Classic developers. Moreover, following a spate of dos attacks against both Ethereum and ETC, a decision to hardfork, while non-controversial for ethereum, has attracted much debate within ETC due to arguments that deletion of empty accounts violates the principle of immutability which was the sole justification for the continuation of ETC in spite of an overwhelming consensus to hardfork.
Both currencies have already hardforked to make some urgent technical changes, but they both are to undergo a second hardfork, expected in a few weeks, which deletes empty accounts. For ETC, this second hardfork may be controversial, but the currency has already lost much support in any event, with its subreddit barely active. The recent cashing out by the hacker may only participate its demise, closing a potentially historical chapter in the decentralized governance of public blockchains.
Image from Shutterstock. Chart from Poloniex.
Last modified: June 10, 2020 10:06 PM UTC