Posted on August 4, 2021 at 2:20 PM
Bitcoin SV (BSV) has been the victim of another 51% hack on August 3rd. The hack resulted in three versions of the chain being mined at the same time. The attack is the fifth one in a row since the end of June.
Lucas Nuzzi of Coin Metrics revealed the attack stating, “After an attempted attack yesterday, some serious hashing power was unleashed today at 11:46 am, and attackers are succeeding,” said Lucas Nuzzi, network data product manager at Coin Metrics, referring to the Bitcoin SV chain.
Attackers Took over the Chain
The report by Coin Metrics stated that the FARUM nodes on Bitcoin SV recorded a “deep reorg with a max depth of 14 blocks.” Despite the lack of further reorganization instances, conflicts on synchronizations were still happening on major mining pools.
“For over 3 hours, attackers were able to take over the chain. All exchanges that received BSV deposits during that time might have been double spent,” Lucas Nuzzi added. Nuzzi also stated that the attackers were after destroying BSV because of the frequency of these attacks since June.
Whilst it is unclear whether the attack has been finalized or not and whether the responsible group will launch another similar attack, Bitcoin SV has responded to the matter through their Twitter pages. The response was given by the Bitcoin Association, the group behind the growth and adoption of BSV.
“In response to the ongoing reorganization attack on the #BSV network, Bitcoin Association recommends that node operators mark the fraudulent chain as invalid. This will immediately return your node to the chain supported by honest miners and lock the attacker’s chain out,” part of the response tweet read.
The association also provided a command on the Bitcoin SV node that node operators can use to invalidate the fraudulent chain. Besides, it also urged users with any queries to reach out to the Bitcoin Association team for any assistance.
BSV could suffer a major blow because of these ongoing attacks. Several exchanges, including OKEx and Huobi, have already suspended BSC trading on the platforms, and this recent attack could trigger more suspensions.
A 51% Attack
A 51% attack on a proof-of-work blockchain is when a group of crypto miners on the platform control more than 50% of the hashrate. Normally, when the blockchain is working as intended, new mining blocks are added when everyone on the network agrees on the validity of those transactions. However, when one group controls more than half of the computing power, they can create and approve blocks without validity being an issue because their majority vote will count.
When there is this kind of attack on a proof-of-work blockchain, it poses significant risks to the blockchain. Other blockchains have suffered similar attacks in the past. Ethereum Classic, also a proof-of-work blockchain, suffered simultaneous attacks in August last year. During the attack, over 10,000 mining blocks were affected, leading to massive losses.
Other networks such as Bitcoin Gold, Verge, Monacoin and Grin have also suffered similar attacks. This creates an argument to disrupt claims that proof-of-work networks are immune to hacks and other network disruptions.
Bitcoin SV, known in full as Bitcoin Satoshi Vision, was created as a hard fork of the Bitcoin Cash blockchain in November 2018. The network is similar to Bitcoin Cash (BCH) and Bitcoin (BTC) in monetary policy. The network was created because of disagreements within the BCH community; hence this fork was created to integrate new proposals to improve the efficiency of transactions on the network.
The creator of Bitcoin SV is Craig Wright, a blockchain entrepreneur from Australia, once claimed that he was the real Satoshi Nakamoto. However, this claim was widely refuted by the crypto community.
The Bitcoin SV network has also faced multiple oppositions because of its model since it parted ways with Bitcoin Cash. The Bitcoin Cash network ranks higher than BSV in computing power, crypto ranking and trading volumes. The BCH token currently ranks the 13th largest, with a market cap of over $10 billion. On the other hand, BSV ranks as the 44th largest cryptocurrency with a market cap of around $2.5 billion. Despite this large gap, BSV’s has managed to acquire a solid space in the crypto market.