- Ethereum Classic suffered three 51% attacks in August 2020.
- The threat of 51% attacks on proof of work blockchains is a “universal problem,” said Terry Culver, CEO of ETC Labs.
- ETC Labs has enlisted the help of law firm Kobre & Kim to pursue the individuals responsible for the 51% attacks.
Repeated 51% attacks on the Ethereum Classic network are a source of “increasing frustration,” according to Terry Culver, CEO of Ethereum Classic Labs.
“Three attacks in one month will tell you that security is an issue on Ethereum Classic,” Culver told Decrypt media partner Forkast.News in a video interview. “Increasing frustration is definitely the best way to describe it.”
The threat of 51% attacks on proof of work blockchains is a “universal problem,” Culver said. “We believe and know that other blockchains get attacked more regularly, maybe with less visibility.”
How secure are proof of work blockchains?
Culver added that the threat of 51% attacks is a “shared problem” for everyone working in the proof of work blockchain world.
“It’s a vulnerability that all Proof of Work blockchains have, even Bitcoin and Ethereum,” Culver said. “We think that they’re secure because of the cost to attack those networks, but the truth is that cost is subjective,” he added, pointing out that, “The cost to attack one of those networks for a state actor, or even a non-state actor, is trivial—in fact, I think those attacks will come.”
The first 51% attack in August was made possible due to rented mining hashpower, allowing the hackers to “double spend” an estimated $5.6 million of ETC. Double spending involves overwriting entries in the blockchain ledger, either changing the destination of a transaction or reversing it.
In the second attack, hackers netted about $1.7 million after employing the same method as the previous attack—renting hashpower from Nicehash provider daggerhashimoto, according to a Bitquery analysis. Prior to those attacks, Ethereum Classic was afflicted by a similar 51% attack in January 2019.
How ETC Labs is tackling 51% Attacks
Following the first two hacks in August, ETC Labs announced that they were working on a security plan for the Ethereum Classic network.
The plan includes a series of “defensive mining measures to both try to alert ourselves to impending attacks and deploy hashpower to prevent them,” Culver explained. Ethereum Classic Labs is also working with exchanges to tell them to increase their confirmation times, he added.
ETC Labs has enlisted the help of New York-based international law firm Kobre & Kim to pursue the individuals responsible for the attacks. According to Benjamin J. A. Sauter, a partner at the law firm, the attacks did not occur due to any technical issue with Ethereum Classic, but were the result of a group acting maliciously to commit fraud.
“What we want to do is send a message to them: that you’re not going to get away with this, we’re not going to take it sitting down, and we are going to try to figure out who you are,” Sauter told Forkast.News.
According to Culver, there’s no question of Ethereum Classic abandoning proof of work; instead, ETC Labs and other developers will continue to find ways to make the blockchain more secure. “It’s a question of innovating so that we can prevent malicious activity and grow the kind of ecosystem we’re trying to grow,” he said.
This story was produced in collaboration with our friends at
Forkast, a content platform focused on emerging technology at the intersection of business, economy, and politics, from Asia to the world. Source: https://decrypt.co/41044/repeated-51-hacks-on-ethereum-classic-are-increasingly-frustrating-says-etc-labs-ceo
Bitcoin Price Analysis: Is The Current 20% Weekly Drop a Healthy Correction or Sub-40K Coming?
Bitcoin is down another 7.5% today as the cryptocurrency slides into the $45,000 region. The total weekly price decrease now exceeded 20%. The good news? Bitcoin was able to recover after hitting as low as $42K earlier today.
An overview of May: Last week, bitcoin fell beneath a rising wedge formation after Tesla revealed they had stopped receiving BTC payments for their cars. The news caused a significant sell-off in which BTC dropped as low as $47,000, where it found support at a .5 Fib. During this sell-off, BTC managed to close each daily candle above a rising trend (dashed line) dated back to February 2021.
However, this support was broken over the weekend after BTC closed at $47,000. It continued lower today as it dropped beneath $47,000 to create a fresh three-month low at $42,185, following some more of Elon Musk’s tweets.
There, BTC found support at a long-term ascending trend line that dates back to December 2020, together with support at $42,770 – provided by the .618 Fib Retracement – best seen on the following 4-hour chart. The market rebounded from there and pushed higher to break back above $45,000, as of writing these lines.
Interestingly, the new three-month low has created a fresh lower low for bitcoin. It also caused the market to break beneath the neckline of a long-term head & shoulders pattern we have been tracking over the past week. The break of this pattern could see BTC heading as low as $32,000 in case the pattern plays out. Unless bitcoin maintains the neckline around $47-48k – the risk is on.
After all, we do have to remember that the market is still bullish on the longer timeframe charts, and 20-30% corrections are typical during bull runs. In the cycle of 2017, bitcoin price saw six heavy 20-30% corrections.
BTC Price Support and Resistance Levels to Watch
Key Support Levels: $44,750, $44,000, $42,770, $42,000, $40,000.
Key Resistance Levels: $46,250, $47,000, $48,000, $50,000, $50,850.
Looking ahead, the first support now lies at $44,750. This is followed by $44,000, $42,770 (.618 Fib), and $42,000 (Jan 21 Highs along with today’s low). Beneath $42,000, added support lies at $40,000 (downside 1.414 Fib Extension & the 200-day moving average line).
On the other side, the first major resistance is expected at $46,250 (bearish .236 Fib). This is followed by $47,000 (April lows), $48,800 (bearish .382 Fib), $50,000, and $50,850 (bearish .5 Fib).
The RSI is heading lower and nearing highly oversold conditions. This suggests that the bears might already be overextended and could mean that the market should not continue too much lower from here.
Bitstamp BTC/USD Daily Chart
Bitstamp BTC/USD 4-Hour Chart
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China Securities Journal Says Cryptocurrency Trading Is Risky and Calls for Strict Supervision
Chinese officials warned the public about the risks associated with trading with digital assets. The authorities pointed out three major considerations which might harm investors – false transactions, security breaches, and illegal and criminal activities involving cryptocurrencies.
Tighter Regulations on Crypto Trading
According to the China Financial Stability Report, investors should be extra vigilant when operating with bitcoin and other crypto assets. Officials from China Securities Journal have called for better regulation and pointed out three major risks that trading with digital assets may carry.
First, digital assets are highly decentralized, which means they lack supervision and legal protection. According to the journal, this is a huge disadvantage and can cause price manipulation and false transactions.
Second, the price of most cryptocurrencies, including bitcoin, can easily become an instrument for speculation and can go through sharp declines.’
Third, the movement of funds on blockchain technology is difficult to be observed. This can create an excellent environment for money laundering. Additionally, illegal and criminal activities can also thrive with these conditions as lawbreakers have the opportunity to make drugs or gun transactions using cryptocurrencies.
The Chinese authorities advised that due to these factors, the crypto community must stay alert to prevent these hazards. Furthermore, China Securities Journal reminded that there are no legal crypto trading venues in the country and no regulatory protections:
”Once you encounter risks, you can only bear the consequences. In short, speculation in coins is risky, and you need to be cautious when entering the market.”
China and BTC
Despite the government’s stance, the primary cryptocurrency is highly popular in China – there’s a high number of miners situated in the large Asian nation.
Recently, the country’s central bank announced that it was looking into bitcoin as an alternative investment. Zhou Xiaochuan, former governor of PBoC, outlined the potential of digital assets and their future implementation. However, he ascertained that whatever the case may be, cryptocurrencies must not be used for illicit activities such as drug or weapon trafficking, gambling, or money laundering:
”We believe that crypto assets should play a major role in the future, either as an investment tool or as an alternative investment. Many countries, including China, are also studying it as an investment tool.”
Litecoin, Monero, Ethereum Classic Price Analysis: 17 May
The Bitcoin market has been on a downtrend and the altcoin market has been mirroring its losses. The markets of Litecoin [LTC], Monero [XMR], and Ethereum Classic [ETC] have been highlighting a similar downtrend while also trying to recover in the short term.
The above chart of Litecoin [LTC] suggested that its value plummeted by 17% within 16-hours. This loss was from $325 to $267. However, after the 17% drop, the LTC value recovered and was now trading at $289.10.
The digital asset has been moving towards immediate resistance at $297.26 but there was evident bearishness in the market due to the fall. As the price slipped low, relative strength index was suggesting that the asset had entered the oversold zone, but this price posed a buying opportunity for others. This buying pressure that was created has pushed the digital asset into a near-equilibrium zone.
The price hangs around the $288-range and the traders may want to be more vigilant as the momentum shifts.
Unlike the Litecoin market, Monero [XMR] market was noting a rise in volatility. The sudden plunge in price pushed LTC from $391 to under $345. Even after recovering to $365, resistance at this level pushed the price once again lower. At the time of press, LTC was trading at $361.
The rise in volatility was indicated by the divergence of Bollinger bands, while the signal line was also plummeting. This suggested that the recent price action has paved the way for the bearishness and as LTC tried to stabilize at the current price, the relative strength index noted that the selling pressure had also increased as it hit 38. Meanwhile, negative momentum was adding to the falling price of LTC.
Ethereum Classic [ETC]
The Etheruem Classic [ETC] price was not as impacted as other alts, thanks to its hard fork Ethereum [ETH]. The ETC price dropped by 19% but managed to recover by 15%. The loss carried ETC value from $110 to 80, but as the market recovers, this value has been pushed to $91.
With the wild price movement, Bollinger bands were noted to converge, which meant that volatility was reducing. As the price surged past the $89 resistance, the market was trying to hold on to this price level. This was also indicated by RSI which was at 47, close to equilibrium. This meant that the buying and the selling pressures were evenly matched. However, the momentum has remained negative.
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