Ethereum Classic Suffers Another 51% Attack, Buterin Suggests Switch to PoS

Ethereum Classic has been in the wars again with a second 51% attack within a week. This incursion has brought the security of the network under the spotlight again, though ETC prices remain largely unmoved at the time of writing.

Earlier today, August 6, Etherchain.org tweeted that its Ethermine affiliated mining pool had disabled ETC pool payouts after more than 4,000 blocks had been reorganized.

Today another large 51% attack occurred on the #ETC which caused a reorganization of over 4000 blocks. Until further notice ETC pool payouts are disabled and we encourage all our miners to switch to our #ETH pool at https://t.co/f8Px6gGJiM in the meantime.

— Bitfly (@etherchain_org) August 6, 2020

This type of attack occurs when a group of miners controls more than 50% of the network’s mining hash rate or computing power.

Exchanges to Halt Trading

Leading crypto exchange Binance was quick to react, adding that its automated system had already halted deposits and withdrawals and that this appears to be a follow-up attack on one that occurred last week.

Meanwhile, Ethereum co-founder Vitalik Buterin suggested that a change in consensus mechanism would alleviate these issues.

“ETC should just switch to proof of stake. Even given its risk-averse culture, at this point making the jump seems lower-risk than not making it.”

Leading Ethereum Classic core development team, ETCcore, called for solidarity posting a whitelist to work from;

“All honest miners and pools. We have to sync together to defeat this malicious actor on our network.”

Last week, the Ethereum Classic blockchain was contentiously split due to the actions of a single miner. At the time, ETClabs founder James Wo replied to reports of the issue, adding that exchanges needed to pause deposits and withdrawals immediately.

That attack resulted in around $5.6 million worth of the cryptocurrency being double-spent with the hacker reaping more than a 2800% return. The malicious actor reportedly spent roughly $192,000 on renting hash power from Nicehash to execute the attack.

According to crypto51, these 51% attacks can be orchestrated against Ethereum Classic using rented hash power for just $15,600 per hour.

ETC Price Impact

At the time of writing, there has been very little movement on ETC prices, which are down less than one percent on the day.

There was a 4% tumble a few hours ago, but prices have remained relatively stable at just over $7. ETC has done very little this year, ranging between $5.5 and $7.5 for the past three months.

It certainly has not enjoyed the big price rally that its big brother has recently undergone, and is unlikely to in the future unless network security can be hardened against these basic proof-of-work attacks.