Network Rollback In Plan For Ethereum Classic After $5.6M Theft

A network rollback is in plan after the Ethereum Classic attack that ended up losing $5.6 million as we reported in the ETC ethereum classic news.

Ethereum Classic suffered a 51% attack last week which was the second attack in less than two years. The investigations at the time showed no evidence of double-spending but a week on, further investigations showed that the attacker managed to double-spend 807,206 ETC in a two day period. According to the data analysis by BitQuery, the attacker launched 11 transactions in the reorganized chain. The investigation also noted that the attack used 17.5 BTC to acquire the needed hashing power to split the chain.

This is not the first time that Ethereum Classic was attacked. Back in 2019, the attackers performed a 51% attack to double-spend 219,500 ETC worth $1.1 million. The scale of the weekend theft is much bigger than the previous attacks. According to an article titled “The Realistic Lucrative Case of Ethereum Classic Attack Today” examined the cost of the attack and the author used the formula:

Total Network Hashrate / Efficient Miner Hashrate = Miner Units needed
Miner Units needed * Miner Unit Cost + Electricity = 51% Attack cost

The network hash rate reached 7000 GH/s in 2018 while the miner hashrate for the Antminer E3 was set at 0.18 GH/s. About 38,888 Antimner E3s were needed and they were priced at $2,150 plus $150K per day for electricity which reached a cost to attack of $85 million. Since 2018, the hashrate on the ETC network dropped substantially and is now at 4000 GH/s mark. The mines were also becoming much more efficient with Bitmain’s Antminer S19 Pro being able to hash 110 TH/s.

Decreasing the network hash rate and increasing the miner efficiency meant that ETC was ready for an attack. Recovering from this will be quite hard as security is the foundation of any strong blockchain. At the same time, immutability should mean that what’s done is done. However, the CEO of Binance Changpeng Zhao tweeted that he had received an alert that the ETC Ethereum Classic blockchain is attempting a network rollback to reverse the attack.

Just got an alert of a roll back involving 4000+ blocks on ETC. Is this true?

Received this after the tweet 2h ago. https://t.co/Ygtsq7PfPp

— CZ Binance (@cz_binance) August 6, 2020

Ethereum Classic was due to a community split on how to deal with the $50 million theft from a developer as some wanted to roll the network back to return the Ether to the rightful owners.