The 51% attack as it is known, is becoming more and more common. Verge, Bitcoin Gold as well as other cryptocurrencies are getting hit by the same attack as well. As a result, double spending is becoming even more uncommon.
The latest currency which faced this problem was Bitcoin Gold. The market capitalization of Bitcoin Gold is $ 707 million.
Owing to such attacks, the cryptocurrency minor was initiating the attack is able to get control of a significant portion of the mining power of a cryptocurrency. As a result, he is able to spend double of the cryptocurrency coins which he or she owns. As a result, they are able to make 100% of the return in a short period of time.
Bitcoin Gold is not the only cryptocurrency which is facing such a problem. Verge is a cryptocurrency which has faced this problem twice in the last couple of months. This is because the loophole which allowed the hackers to conduct this attack wasn’t closed by the developers. In many cases, there are smaller coins which are also facing these attacks as well. The coins which have increased significantly in value are the ones which are being targeted by the hackers. As a result, they are able to easily cheat the system in order to have double coins.
Currently, efforts are on in order to create a hardware which will avoid such attack. At the same point in time, the development teams of the various cryptocurrencies are also evolving the algorithm to ensure that such attacks do not take place. However, currently, the infrastructure is quite weak.
The smaller community is impacted the most:
According to Lex Sokolin, who is director of Fintech strategy at Autonomous Research, the smaller community is like the infrastructure in order to make the entire network Private. As a result, it is easier for the cryptocurrency minors to initiate a 51% attack. This ensures that they are able to make a significant amount of money as they are able to spend double the coins which they currently own. Also, with the value of the coins increasing significantly, it is becoming a lucrative proposition for the hackers to actually initiate the 51% attack.
Till the time, the developers of the coin have become more alert about these attacks; such attacks will not stop at all. This is the reason why it is up to the development team now to stop such attacks. If loopholes exist, such attacks will indeed continue.
Let us know in the comment below what you think of the attacks on cryptocurrencies.