Tech 6 April 2018

Erik Gibbs

Private coin Verge forks after massive 51% attack

Verge, a cryptocurrency that prides itself on privacy, has proven to not be so private. A massive attack on the Verge blockchain has resulted in the altcoin creating an obligatory hard fork to stop the attack. The hack resulted in the coin losing around 25% of its value, and claims of around 250,000 Verge worth approximately $13,000 being stolen.

A hacker was able to gain control of the network’s hashrate, giving him or her the ability to modify transactions, according to reports. The individual pestered the Verge team further by posting a response to a thread on bitcointalk.org in which he stated, “Hey Verge Team, get some real developers and fix your code. We have found another 2 exploits which can make quick hashes as well.”

The hacker had identified a number of exploits in the Verge code, enabling him to mine multiple blocks at one-second intervals. All of the mining operations used the same scripted algorithm, which should not have been possible. The attack lasted for three hours and confirmed hundreds of blocks, which resulted in developers having to roll back the blockchain to undo the damage.

Adding insult to injury, the attack wasn’t even picked up at first by Verge developers. A user in the bitcointalk forum, “ocminer,” was the one who brought up the topic. At first, his warnings fell on deaf ears—by both developers as well as Verge enthusiasts—before the problem was determined to be real.

Verge wasn’t quick to own up to the issue after it had been confirmed. They called it a “minor incident” and one that “wasn’t as bad as it could have been.” The Verge community wasn’t as forgiving at this point, though, and vented their frustration online. One user said, “Based on what I see from the dev postings here it’s apparent that if ocminer had never brought this to everyone’s attention, the XVG team would have never admitted to or disclosed what happened. Trying to downplay and being flippant about the severity here is just pissing on the XVG faithful.”

Verge developers indicated that around 250,000 coins were stolen, but many think the amount was much higher. A user in the bitcointalk.org thread pointed out the mathematics behind the blocks, and was able to ascertain that around 3.9 million coins were stolen. If that’s true, around $200,000 would have been taken.

Verge has had a rough year, and it doesn’t look like things are going to get better. There have been repeatedly instances of privacy compromise, it had its Twitter account hacked and tried to get the community to cough up $3 million for “the deal of a lifetime.” Add to this the latest 51% attack, and the light at the end of the tunnel seems to be fading, not growing brighter.

Note: Tokens on the Bitcoin Core (SegWit) chain are referenced as BTC coins; tokens on the Bitcoin Cash ABC chain are referenced as BCH, BCH-ABC or BAB coins.

Bitcoin Satoshi Vision (BSV) is today the only Bitcoin project that follows the original Satoshi Nakamoto whitepaper, and that follows the original Satoshi protocol and design. BSV is the only public blockchain that maintains the original vision for Bitcoin and will massively scale to become the world’s new money and enterprise blockchain.

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