Gold-backed AurumCoin is the latest cryptocurrency project to fall victim to 51 percent attack, resulting in the loss of AUD$ 15752.26, per a report by Finder on November 12, 2018.
Hack Attack Results in Blame Game
Shortly after the hack attack, AurumCoin’s twitter handle subtly sparked the blame game stating the coins were stolen from the wallet of cryptocurrency exchange Cryptopia.
We do not “blame” cryptopia, but coins were stolen from their wallet. That is a fact.https://t.co/Xq4Z1wxGoG
— AurumCoin (@Aurum_Coin) November 11, 2018
The cryptocurrency project’s official website also acknowledges the 51 percent attack evident by the message on the homepage which reads:
“Cryptopia exchange was hacked (51% attack), a total of 15,752.26 AU is missing from Cryptopia’s wallet. Aurum coin network is not the responsibility of anyone, same as Bitcoin network, it is open source distributed cryptocurrency. What’s worse is that cryptopia exchange do not admit it. This is not the way to solve this problem.”
Looking at the incident, several arguments can be laid against AurumCoin and Cryptopia. While the crypto project could have displayed pro-activeness by efficiently addressing its potential vulnerabilities, Cryptopia, being a premier cryptocurrency exchange in New Zealand could have ensured that proper safety mechanisms are in place to avoid any such breach of investor’s money.
Further, AurumCoin still uses the SHA-256 mining algorithm which makes it an easy prey to fall victim to 51 percent attacks. Having an average hashrate of just about 80PH/s didn’t help AurumCoin’s cause either. For about US$9.13 per PH/s per hour, one can easily rent almost 500 PH/s of SHA-256 mining power on NiceHash.
On the other hand, Cryptopia is one of New Zealand’s top cryptocurrency exchanges. Being the largest exchange in the country, the firm cannot absolve itself of the attacks carried out by the wrongdoers that directly put the investor’s money in peril.
51 Percent Attack Still a Looming Threat
The infamous 51 percent attacks have been one of the most substantial problems faced by the cryptocurrency industry since inception. There are already concerns floating around in the cryptosphere about the Chinese mining giant Bitmain’s increasing control of the Bitcoin network hashrate, as it steadily makes its move towards the fatal 51 percent figure.
Earlier this year, privacy-centric altcoin ZenCash also succumbed to a 51 percent attack. However, the foundation immediately deployed “mitigation procedures to significantly increase the difficulty of future attacks on the network.”