Coinbase Stops Ethereum Classic Operations Following Signs of Attack

While crypto markets are no more considered as a safe haven, the top-level crypto exchanges like Binance, Coinbase, and some other massive crypto trading platforms were known to be safe and secured. However, Coinbase, the largest crypto exchange in the US has recently observed signs hinting that the network of Ethereum Classic is under attack.

Coinbase Announces Attack

The exchange revealed that it halted the movement of customer funds of Ethereum Classic because of signs that the network has been attacked. Coinbase gave further details through its website that “deep reorganizations” of the Ethereum Classic blockchain has been detected.

The exchange announced this today through a tweet also.

On 1/5/2019, Coinbase detected a deep chain reorganization of the Ethereum Classic blockchain that included a double spend. In order to protect customer funds, we immediately paused movements of these funds on the ETC blockchain. Read more here: https://t.co/vCx89dz44m

— Coinbase (@coinbase) January 7, 2019

The attack was not a one-time event. The exchange said that it had found at least nine reorganizations containing double spends. The exchange also observed double-spends with the total amount of $500,000 in digital coins. This incident of attack points out to 51% attack, in which some computers supporting a network falsify transactions.

The Ethereum Classic Team :

Ethereum Classic’s team responded that they are looking into Coinbase’s assertions and haven’t found any conclusion yet. The team noted, “Facts are facts, and as the situation develops we’ll soon get a full picture of what actually took place.”

Regarding @coinbase account of recent events: they allegedly detected double spends but unfortunately did not connect with ETC personnel regarding the attack.
This is still very much an ongoing process. https://t.co/in1OGdV8T9

— Ergo (@Ergo_Platform) January 7, 2019

Amid that, Ethereum Classic dropped 7.7 percent as of 4:45 p.m. in San Francisco. At present, the currency ranks as the 18th-largest cryptocurrency with a market cap of more than half a billion dollars.

The Double spend attack :

These double-spend attacks are usually targeted at cryptocurrency exchanges. After depositing funds to an exchange, the attackers convert them into another currency and then withdraw them. Here, the attacker alters the blockchain’s recent history, sending the funds that they had previously sent to the exchange.

Additionally, on this attack, Coinbase confirms that it had identified the double-spending but had not been the target of these attacks and all the customer funds are secure. Though, it is not figured out that who the attackers targeted.