Cryptocurrency exchange #Gate.io confirmed that it had lost about $220,000 worth of #Ethereum Classic coins – about 40,000 ETC – during the ongoing manipulation of the project’s blockchain network.
The exchange confirmed Tuesday that the #Ethereum Classic #blockchain was under 51% attack – in which a single entity takes control of more than half the network’s #hash power that allows it to rewrite its transaction #history and double-spend #coins – and identified three accounts about the attacker(s).
“It happened #between 0:40 Jan.7, 2019 and Jan 4:20 Jan.7, 2019 UTC for about 4 hours,” Gate.io revealed in a blog post. “All the #transactions were confirmed normally on the #ETC blockchain and became invalid after the blockchain rollback.”
At the time of transfers, the ETC/USD rate was #fluctuating between $4.90 and $5.25, according to the details available on #CoinMarketCap.com.
“Gate.io’s #censor successfully blocked attacker’s #transactions at the beginning and submitted them to the manual exam,” explained Gate.io. “Unfortunately, during the 51% attack, all the #transactions looked valid and confirmed well on the blockchain. The #examiner passed the transactions. It caused about 40k ETC loss due to this attack. Gate.io will take all the loss for the #users.”
$1 Million Theft Reported
Coinbase, the US crypto# exchange which first brought the 51% attack before the press, today revealed that the attackers were still #exploiting the Ethereum Classic network and had siphoned-off 219,500 ETC coins worth over a million #dollars. Blockscout, an Ethereum Classic blockchain explorer, confirmed reorganization attacks between# block numbers 7261495 and 7261496. Per their data, a #transaction containing 26,000 ETC was first spent during the #mining of block number 7261492; the same transaction was again noted on block number 7261497.
Almost all the #exchanges have discontinued their ETC deposits and withdrawals but none of them – except Gate.io – have #reported any losses. The situation leads to a scenario whereby #attackers are holding all the stolen #ETC with no options to liquidate them for fiat. Ideally, it should lead to a flat price #action before the Ethereum #Classic team comes up with a solution to entirely repeal the attack.
Ethereum Price Action is Flat and #Rangebound despite 51% Attack | Source: TradingView/BitFinex
Ethereum Classic Responds
Ethereum Classic developer Donald #McIntyre admitted they were looking at a textbook 51% and double spend attack – an opinion which was refuted by #Cody Burns, another fellow ETC developer, who believed that there was more room for #investigation.
“To be clear we are making no #attempt to hide or downplay recent events,” the #group stated in an official response. “Facts are facts and as the #situation develops we’ll soon get a full #picture of what actually took place. #Linzhi is testing #ASICS. Coinbase reported #doublespends; both may be true.”
The team subsequently raised its #prevention tactics by asking exchanges to increase their #block confirmation times.