Crypto Market Awaits More Hacking Attacks In The Coming Days

A couple of weeks back, the Coinbase security team noticed that someone had made a deep reorganization in the distributed ledger for Ethereum Classic. The hackers successfully launched a 51 percent attack on the blockchain and made away with over $200,000 worth of the digital currency.

Gate.io was particularly affected, but according to a report released by them, about $100,000 worth of the Ethereum Classic digital currency was returned by the hackers.

The company speculates that the perpetrator may have been a white-hat hacker who wanted to demonstrate the vulnerabilities of the Ethereum Classic network.

What caused 51 percent hacking attack

As reported in coinbase, the Ethereum Classic hacking case, the hackers rented enough hashing power to undermine the prevailing one and then carried out a heist after launching a double-spend attack.

The incident occurred on January 7 and was sustained for four hours. All transactions were confirmed during the attack, and passed the validity test, but became invalid after the hack was over.

The report details how a 51 percent attack is contingent upon one entity controlling over half of the prevailing hash rate on a network. In this case, the attacker can halt transactions, reverse them, or rewrite the blockchain history.

Coinbase was able to block the hacking attempt on its network just in time by holding all the transactions involving the Ethereum Classic cryptocurrency. The site reportedly discovered 12 double-spend instances on the network totaling about 219,500 ETC valued at just over $1 million.

The 51 percent attack vulnerability is the sine qua non to proof-of-work networks. Normally, a blockchain is maintained by the miner, nevertheless, with overwhelming computing power, the nodes can overwrite a blockchain.

According to the latest report, Gate.io has implemented a 51 percent detect as an extra protection measure. The platform has also raised transaction confirmation figures in 4,000.

Seven rollback transactions were detected on the Gate.io platform and four were used by the attacker to transfer 54,200 ETC. The company notified other exchanges of the addresses used by the hacker and announced that it would reimburse affected clients. At the time of the incident, Ethereum Classic had a value of about five dollars.

Hacking Attempt

In November last year, Gate.io also suffered a hacking attempt via Statcounter. Malicious code was injected into the Statcounter script that had been embedded on the site. The code was designed to capture transactions made on the platform, particularly withdrawals, and replace receiving addresses with those belonging to the hacker.

Statcounter is an analytics script similar to Google Analytics that monitors visitor activity. In this case, hackers modified it for use as an intrusion tool. Gate.io was apparently able to disable the script on its platform in time, effectively curtailing the attempt.