TLDR
- Qubic claims to control over 51% of Monero’s hashrate, causing alarm.
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A six-block reorganization on Monero’s blockchain sparks debate on attack success.
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Monero’s price has dropped by 16% amid Qubic’s controversial control over its hashrate.
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Developers disagree on whether Qubic’s move qualifies as a successful 51% attack.
Qubic, a blockchain project led by former IOTA co-founder Sergey Ivancheglo, claims to have taken control of more than 51% of the global hashrate for Monero. This achievement has prompted serious concerns about a potential 51% attack on Monero’s network. The claim comes after weeks of strategic moves that have allowed Qubic to become a dominant force in Monero mining. While Qubic frames this as a stress test for the Monero network, the move has raised alarms about the security of the privacy-focused blockchain.
The 51% control means Qubic could potentially reorganize blocks, censor transactions, and execute double-spend attacks. As these risks become evident, industry experts and Monero developers are divided on whether the situation represents a successful attack or a technical stress test. Monero’s price has already shown signs of strain, dropping 6.65% in a 24-hour period and losing 16% over the last week, reflecting investor concerns.
Concerns Over Potential 51% Attack on Monero
A 51% attack happens when a group or entity gains control of more than half of a network’s mining power. In this case, Qubic’s reported control of Monero’s hashrate has sparked warnings about a possible attack. A six-block reorganization on the Monero blockchain, which discarded 60 blocks, has led to discussions on whether Qubic has successfully performed such an attack.
Some security experts, such as SlowMist co-founder Zhong Chenming, have expressed concern that Qubic now has the power to rewrite blocks, potentially introducing risks like double-spending or transaction censorship.
However, not everyone agrees that the six-block reorganization is enough to label the event as a successful 51% attack. Luke Parker, lead developer at SeraiDEX, pointed out that the reorganization could be the result of “luck” and not a direct attack. This leaves the situation in a gray area, with the Monero community continuing to assess the full implications of Qubic’s actions.
Qubic’s Economic Model and Network Manipulation
Qubic’s “useful proof-of-work” (uPoW) model has been a significant part of its strategy. By converting Monero (XMR) mining rewards into USDT, Qubic uses the proceeds to buy and burn its own QUBIC tokens.
This model, which began in May, is intended to strengthen the Qubic ecosystem by directing the mining rewards from Monero to its own deflationary mechanism. Over the months, Qubic’s share of the Monero hashrate grew dramatically, rising from under 2% to over 25% by late July.
This shift led to Qubic’s eventual claim of 51% control. While Qubic’s leaders argue that this move is part of an effort to help Monero prepare for future threats, the broader crypto community has raised questions about the ethics of using one blockchain to exert control over another. The impact on Monero’s price and the concerns about potential attacks highlight the friction between the two networks.
Monero Community Responds to Qubic’s Actions
The Monero community has not taken Qubic’s actions lightly. After the initial claims, there was a significant pushback, with some developers attempting to mitigate the situation. One of the responses was a distributed denial-of-service (DDoS) attack on Qubic’s mining pool in late July, which led to a reduction in the mining pool’s hashrate.
The Monero network has long prided itself on being resistant to centralization, particularly from ASIC mining hardware, and Qubic’s growing control has sparked concerns that Monero’s decentralized principles may be under threat.
While Qubic maintains that it is merely testing the network, the Monero community is keenly aware of the risks involved. The ongoing tensions between the two sides reflect broader issues within the crypto space, particularly around centralization of power in mining and the potential vulnerabilities that arise from such concentration.
