<\/p>\n
QUBIC is down 7% as the project’s self-proclaimed “experiment” sparks backlash in the Monero community after it led to a short-lived network reorganization.<\/p>\n
Monero<\/a>\u2019s (XMR) network faced unusual activity this week after smaller-cap blockchain project Qubic revealed a brief takeover of Monero\u2019s mining power. The move has sparked debate over what actually happened and what it means for the privacy coin.<\/p>\n In an Aug. 12 announcement<\/a> on its blog, Qubic declared that after \u201ca month-long, high-stakes technical confrontation\u201d it had \u201creached 51% of Monero’s hashrate dominance, successfully reorganizing the blockchain.\u201d<\/p>\n In other words, the team behind Qubic admitted, and even advertised, that it was on the verge of performing a 51% attack on the privacy coin network. The Qubic team said in the post that it had decided \u201cnot to take over the protocol’s consensus for the moment because of internal discussions on whether that would hurt Monero’s price.\u201d<\/p>\n While the community was still guessing about whether or not Qubic lied about its achievement, the price of XMR<\/a> dropped about 11% between Aug. 11-12, trading near the $250-$260 range since then. The asset is down about 11% on a weekly frame. <\/p>\n Monero is the 42nd largest crypto asset by market capitalization, and is the largest<\/a> privacy-focused blockchains<\/a>. <\/p>\n Qubic is a Layer 1 blockchain and ranks 230th among crypto assets on CoinGecko, with a market cap of $367 million. <\/p>\n Meanwhile, Qubic\u2019s native token QUBIC rallied this week and is up nearly 30% over the past seven days, per data from CoinGecko<\/a>. The asset is down today, however, losing over 7% over the past 24 hours.<\/p>\n Ethan Vera, chief operating officer at Luxor Technology, said that the incident shows challenges for proof-of-work networks. He told The Defiant that this consensus algorithm \u201cdoesn’t necessarily work for all the other blockchains,\u201d noting that Bitcoin remains the most secure blockchain because it has the largest, specialized mining infrastructure.<\/p>\n \u201cIt’s critical to have a high level of specialized compute and large energy and infrastructure footprint to protect from attacks, including at a Nation-state level,\u201d Vera said.<\/p>\n The crypto community had been noticing unusual activity on the Monero network since late July, when reports surfaced<\/a> that Qubic had been attempting to capture Monero\u2019s hashrate since mid-May, increasing its share from just a few percent to nearly 30% within weeks.<\/p>\n At the time, core contributors to Monero appeared skeptical about Qubic\u2019s capabilities. One of them, Ricardo Spagni, clarified in late July in an X reply<\/a> that the network \u201cis not under attack,\u201d repeating this denial in subsequent replies to multiple warnings.<\/p>\n After Qubic published their announcement about the \u201cexperiment\u201d this week, Spagni maintained his stance, writing in an X reply<\/a>:<\/p>\n \u201cIf they genuinely had 51% of the hashrate they would sustain their mining, capture the rewards through a selfish mining attack, drive legitimate miners out, which would increase their hashrate well past the 51%. They haven\u2019t, because they don\u2019t have anything close to that.\u201d<\/p><\/blockquote>\n<\/figure>\n Analysts at BitMEX Research suggested<\/a> in an X post on Aug. 12 that there was \u201cno evidence this was a double spend attack,\u201d and that the reorganization was small, involving just six blocks.<\/p>\n Once Qubic revealed their progress, BitMEX Research said it is not likely that Qubic actually controls over 51% of the Monero network’s hashrate, though they noted that if Qubic were to capture all of Monero\u2019s block rewards, the value of the coin \u201cmay fall.\u201d<\/p>\n As speculation about a 51% attack grew this week, several crypto exchanges paused XMR withdrawals. Centralized crypto exchanges MEXC, HTX, WhiteBit, and swapping services ChangeNOW and FixedFloat all reportedly<\/a> suspended withdrawals of XMR indefinitely, as of an Aug. 11 X post. <\/p>\n ChangeNOW CSO Pauline Shangett confirmed to The Defiant that the service did indeed halt withdrawals, due to concerns over Qubic\u2019s on-chain activity.<\/p>\n A Whitebit spokesperson also told The Defiant that when reorganization activity started on the Monero network on Monday, the exchange paused XMR deposits and withdrawals \u201cas a precaution.\u201d Withdrawals have since resumed, the exchange added. <\/p>\n The Whitebit spokesperson also distinguished between a 51% attack and a block reorganization, telling The Defiant, \u201cThe recent six-block reorganization on the Monero network does not necessarily indicate a sustained 51% attack. Such events can occur naturally when a miner or mining group with significant hash power experiences a period of unusual luck.\u201d <\/p>\n The exchange\u2019s spokesperson elaborated:<\/p>\n \u201cIn this case, the network promptly reorged on the seventh block, replacing the prior chain and confirming transactions as intended. This is expected behavior within the blockchain consensus mechanism and does not point to any ongoing compromise of the network or impact on WhiteBIT\u2019s operations.\u201d<\/p><\/blockquote>\n<\/figure>\n The Defiant contacted the other exchanges for comment, as well as the Qubic, BitMEX Research, and Monero teams, but hadn\u2019t received responses from them by press time.<\/p>\n Per Qubic\u2019s Tuesday blog post, the block reorganization was to prove that economic incentives can influence miner behavior. <\/p>\n Peter Todd, a cryptographer and Bitcoin Core developer now widely known for his appearance in a recent HBO documentary about Bitcoin\u2019s creator<\/a>, suggested in an Aug. 12 X post<\/a> that a likely goal of the reorganization is to \u201creduce the income of other miners to encourage even more hash power to move to their pool. Or give up entirely.\u201d<\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":" QUBIC is down 7% as the project’s self-proclaimed “experiment” sparks backlash in the Monero community after it led to a short-lived network reorganization. Monero\u2019s (XMR) network faced unusual activity this week after smaller-cap blockchain project Qubic revealed a brief takeover of Monero\u2019s mining power. The move has sparked debate over what actually happened and what […]<\/p>\n","protected":false},"author":2,"featured_media":401980,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[6],"tags":[274,273,272,244,266,271,268,270,269,267],"class_list":["post-401976","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-de-fi","tag-crypto-finance","tag-decentralized-finance","tag-liquidity","tag-metamask","tag-pancake","tag-slippage","tag-sushiswap","tag-tronlink","tag-trust-wallet","tag-uniswap"],"_links":{"self":[{"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/posts\/401976","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/comments?post=401976"}],"version-history":[{"count":1,"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/posts\/401976\/revisions"}],"predecessor-version":[{"id":401982,"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/posts\/401976\/revisions\/401982"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/media\/401980"}],"wp:attachment":[{"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/media?parent=401976"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/categories?post=401976"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/tags?post=401976"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}Denial and Doubt<\/h2>\n
Chain Reaction<\/h2>\n