Ethereum Classic Attacker Returns Part Of The Stolen Funds From The 51% Network Attack


Recently, there was a 51% power consolidation attack on the Ethereum Classic network. The attacker got away with a huge amount of money but new reports shows that the attacker has returned $100, 000 out of the money in tokens. The news of the returned funds was initially published by Gate.io, the cryptocurrency exchange, on the 10th of January 2019. The firm reported that the attacker, who is still anonymous, decided to return $100,000 out of the stolen funds without any explanation.


Is The Person Behind The 51% Attack A White Hacker Or A Black Hacker?


In the virtual world, there are two types of hackers, white hat hackers and black hat hacker. The white hat attackers hack for the sake of knowledge or to expose loopholes and vulnerabilities that should be fixed while the black hat hacker hacks for personal gain. A typical example of an attack from a black hat attacker is a ransomware attack.


Ethereum Classic (ETC) Price Today – ETC / USD
NamePrice
bitcoin
Bitcoin
$8,035.300.337%
ethereum-classic
Ethereum Classic
$4.494.03%


Now, there is the possibility that the person or organization responsible for the Ethereum Classic network attack is a white hat attacker. Gate.io has made several attempts to contact the attacker to no avail. With no explanation from the attacker, the exchange speculates that the attacker was a white hat attacker who only launched the attack in a bid to create awareness about the risks associated with the cryptocurrency industry and particularly the proof-of-work consensus algorithm.


The statement from Gate.io was as follows:“On the 10th of January, we found out that the attacker who launched the 51% power consolidation attack on ETC sent back $100, 000 worth of ETC tokens. Since then, we’ve been trying to contact the attacker to get more information but we haven’t been successful. If the attack wasn’t trying to make a profit, it’s possible that he/she may have been a white hat attacker who wanted to remind the public of the risks of using the proof-of-work consensus algorithm and the vulnerabilities in hashpower security.”


The Gate.io team also said that such an attack may occur again on the Ethereum Classic network because it is easy to rent enough hash power to gain up to 51% control of the blockchain. This isn’t a threat peculiar to the Ethereum Classic blockchain alone. Any blockchain that depends on the proof-of-work consensus mechanism is prone to such an attack.
The exchange seconded the advice that was originally given by the Ethereum Classic development team on Twitter. The team posted some measures that should be carried out to increase protection of the network. One of them was increasing the number of required confirmations for transactions to 4000. The statement continued:


“From our analysis, the hashing power on the Ethereum Classic network isn’t strong enough. Determined parties can still rent enough hashing power to launch another 51% attack on the network. We have decided to raise the confirmation number for Ethereum Classic transactions to 4000. We have also developed a 51% hash power detect to improve protection. We recommend these suggestions to other Ethereum Classic exchanges. It will provide a level of protection against future reorganization attacks.”


Ethereum Classic (ETC) Price Analysis


Right now, the entire cryptocurrency market is taking a hit. ETC isn’t left out. At the time of writing, ETC was trading at $4.29. This shows that it is down by 5.43% against the USD and down by 3.46% against Bitcoin (BTC). The trading volume over a 24 hour period is $122,060,287 and the market capitalization is $461,445,079.

Max writes about blockchain projects and regulation with a special focus on United States and China. He joined Smarterum after years of writing for various media outlets.

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