verge 51% attack
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Verge, PornHub’s first crypto, suffers 51% attack a half million blocks deep

Hackers reversed all the transactions processed on the Verge network in the last 200 days

The privacy-centric stablecoin Verge has suffered a 51% attack with a major block reorganization.

Antoine Le Calvez, an engineer at crypto asset data firm Coinmetrics pointed out in a Feb. 15 tweet that the Verge blockchain experienced a reorganization—change in transaction history—that is more than 560 thousand blocks deep. He said that the firm’s node of the network saw its transactions from after July 2020 change.

“The past 200 days worth of $XVG transaction history just vanished,” said Coinmetrics network data product manager, Lucas Nuzzi, on Twitter. “This is likely the deepest reorg that has ever taken place in a ‘top 100’ cryptocurrency.”

Verge gained attention in April 2018, when the world’s largest streaming pornography site, Pornhub, began accepting the cryptocurrency as an alternative way for clients to pay live webcam models. In January 2020 it added Tether, and then in September Bitcoin and Litecoin. Which was a good move as a devastating New York Times article about its darker content caused Mastercard, Visa, and other mainstream payment processors to cut ties with the business in December, leaving it reliant on cryptocurrency.

All the transactions performed on the Verge network within the past 200 days have been rolled back as a result of the attack. The attackers presumably have done this to spend their XVG within the last 200 days and now reverse the transactions to get the asset back, after already having obtained the product or service that they paid for.

As a side effect, all the users who acquired Verge within the last 200 days and still held it at the time of the reorganization now have their wallets emptied. One Twitter user commented, “So who used to have $XVG but now finds their wallet empty. This is why you need a network with high security and lots of hash power. #Bitcoin”

The comment is referring to the security issues brought by proof-of-work (PoW) altcoins with a low total network hashrate. If one party gains control more than 50% of a PoW blockchain, then that person or organization can reverse past transactions by creating an alternative, valid blockchain starting at a chosen past block. When this alternative blockchain becomes longer than the main blockchain it substitutes for the original blockchain, reversing all of the transactions contained in the blocks that it replaces.

It is rather unlikely that Bitcoin, with its total hashrate of over 157,000 terahashes per second, will be attacked. The amount of computing power needed to attack a network that large is too much for even nations to carry out without being noticed long before the attack can be completed. Verge, on the other hand, has a much lower hashrate that allows for practical attacks.

Verge is not the first altcoin to suffer such an attack. As Modern Consensus reported just over two years ago, Ethereum Classic (ETC) at the time suffered a 51% attack that saw the hackers steal $1.1 million with a reversed transaction-induced double-spend.

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Adrian is a newswriter based out of Pisa, Italy. He's passionate about cryptocurrency, digital rights, IT, tech and futurology and likes to think about the future in a positive way.