What happened
In early January 2019 an attacker took majority control of Ethereum Classic's hashrate and ran a 51% attack, repeatedly reorganizing the chain to double-spend coins sent to exchanges. Coinbase detected the first deep reorganization containing a double spend on 5 January and paused ETC transactions. It later reported further reorganizations with double spends, bringing the total to 219,500 ETC, about $1.1 million, and said no Coinbase customer funds were lost.
Gate.io disclosed a direct loss. It said deposits it credited on 7 January were later wiped out by the rollback. It first put the loss at about 40,000 ETC (~$200,000) and later at 54,200 ETC (roughly $250,000), and said it would absorb the loss for its users. Around 10 January the attacker sent about $100,000 worth of ETC back to Gate.io without explanation.
How it happened
- The attacker gathered more hashing power than the rest of the ETC network combined and mined a private chain out of public view.
- On the public chain they deposited ETC to exchanges such as Gate.io, waited for the deposits to be credited, and traded or withdrew the value.
- On the private chain the same coins went to the attacker's own addresses instead.
- They then released the longer private chain. Nodes switched to it, the exchange deposits disappeared, and the attacker kept both the withdrawn value and the coins.
- Exchanges stopped the attack from paying off by suspending ETC or sharply raising the number of confirmations required for deposits.
Protocol details
Evidence
- analysis DeFiLlama defillama.com
- analysis Ethereum Classic (ETC) Hit by Double-Spend Attack Worth $1.1 Million thehackernews.com
- analysis Exchange Says $200K in Ethereum Classic Lost As Blockchain Attacks Continue coindesk.com
- analysis Ethereum Classic's 51% Attacker Had Mysteriously Sent Back $100,000 To Gate.io Exchange cryptopotato.com
- analysis ethereumclassic.org page ethere….org ethereumclassic.org
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