Op-ed: China Ranked [51% Attack] Verge and Bitcoin at #13 in Blockchain List

Journalist:
May 23, 2018

On May 22, CCN reported that Verge (XVG), a privacy-focused cryptocurrency, fell victim to yet another 51 percent attack. Altcoin mining pool operator Suprnova revealed that an individual or an organization has invalidated legitimate blocks.

Verge Attack

“Verge is once again under attack, someone is 51%’ing the chain and invalidating all legit blocks. All pools and miners suffer from this, the attacker is getting all blocks currently,” said Suprnova.

According to ocminer, the attacked gained two mining algorithms known as scrypt and lyra2re with almost no difficulty and utilized fake timestamps to trick the network. Consequently, the attacker has been able to invalidate many legitimate blocks and take over the network. Within a few hour span, the attacker gained more than $1.75 million, approximately 35 million XVG.

However, it remains unclear whether the attack can be described as a 51% attack given that the attacker did not have to gain 51 percent of the Verge network’s computing power to steal millions of dollars worth of XVG.

Some members of the Verge community claimed that it was a time warp modified vector attack, which is a vulnerability that needs to be addressed by the Verge development team in the near future to prevent similar attacks. Describing the case as a time warp vector attack would make more sense, as the attack was able to gain control over the network with virtually no difficulty.

Impossible With Bitcoin

Recently, the Chinese government released its public blockchain rankings and ranked Verge and Bitcoin at number 13. The ranking of bitcoin, the most robust blockchain network with the longest track record at 13 with Verge outraged the bitcoin community.

Bitcoin is highly unlikely to suffer the same fate.

The core difference between bitcoin and other altcoins and smaller blockchain networks as explained by security expert and bitcoin researcher Andreas Antonopoulos is that bitcoin’s computing power eliminates the possibility of 51 percent attacks. While state-sponsored attacks could be possible with billions of dollars in resources, it is highly unlikely and can be dealt with ease.

Antonopoulos explained:

“I don’t worry about that [51% attack on bitcoin] at all. This cannot be done with bitcoin anymore. This is something that could only be done with nascent altcoins. Bitcoin has achieved a level of computing that no single nation-state can overthrow it with computation alone. The effort to do so would require a massive covert operation of chip fabrication then the coordinated assault that would give them dominance over the next block for 10 minutes until we kick those bastards off the network, rework the protocol around them, they would be revealed, they would have lost a billion dollars doing this and all they got to do is one double spend.”

The Verge blockchain network attack, which was caused by a vulnerability, has shown that blockchain networks with long records like bitcoin and Ethereum are significantly more secure because they have dealt with vulnerabilities in the past, building resilience and strength.

Featured image from Shutterstock.

Joseph Young @iamjosephyoung

Hong Kong-Based Finance Analyst. Contributing regularly to CCN and Hacked. Providing unique insights into the fintech space since 2012.