Waves were sent through the cryptocurrency industry on Monday when San Francisco-based crypto exchange Coinbase announced that it had suspended Ethereum Classic (ETC) following the discovery of what it claimed was a double-spend 51% attack.
“On 1/5/2019, Coinbase detected a deep chain reorganization of the Ethereum Classic blockchain that included a double spend,” Coinbase said in the announcement. “In order to protect customer funds, we immediately paused movements of these funds on the ETC blockchain. Subsequent to this event, we detected 8 additional reorganizations that included double spends, totaling 88,500 ETC (~$460,000)”
As part of its suspension, Coinbase halted all Ethereum Classic transactions, withdrawals and deposits. However, despite the ramifications of both the attack and the decision to halt activity on one of the world’s leading exchanges, Coinbase reportedly didn’t contact the team behind Ethereum Classic as the events unfolded.
Regarding @coinbase account of recent events: they allegedly detected double spends but unfortunately did not connect with ETC personnel regarding the attack.
This is still very much an ongoing process. https://t.co/in1OGdV8T9
— Ethereum Classic (@eth_classic) January 7, 2019
While the situation is still ongoing, the Ethereum Classic team has called into question whether the current hash rate issues are tied to a double-spend 51% attack. In fact, the Ethereum Classic team believes that the suspicious network activity could be tied to ASIC manufacturer Linzhi testing out new 1,400/Mh Ethash machines. However, it will likely be some time before the final cause is determined.
As the situation develops we want to remind exchanges and pool operations to substantially increase block confirmation times (+400)
— Ethereum Classic (@eth_classic) January 8, 2019
Surprisingly, ETC only fell around 7% following the news. The 19th largest altcoin has since bounced back to $5.00, giving the project a $537 million market cap.
Disclaimer: This article’s author has cryptocurrency holdings that can be tracked here. This article is for informational purposes only and should not be taken as investment advice. Always conduct your own due diligence before making investments.