Gate.io, a US based crypto exchange with a daily trading volume of $94 million, said it has lost over 40 000 Ethereum Classic worth over 220 000 USD after a hacker attack on January 7th.
It is assumed that it was a “51%” attack, in which a user or a group seizes the control of the majority of mining power to monopolize control over the network. A successful “51%” attack will allow hackers to rewrite the transaction history of the block chain and double spend coins for fiat currency.
Such kind of attacks are typical for block chains that use a proof-of-work (PoW) algorithm.
“It happened between 0:40 Jan.7, 2019 and Jan 4:20 Jan.7, 2019 UTC for about 4 hours. All the transactions were confirmed normally on the ETC blockchain and became invalid after the blockchain rollback”, Gate.io said in a block post.
“Gate.io’s censor successfully blocked attacker’s transactions at the beginning and submitted them to the manual exam. Unfortunately, during the 51% attack, all the transactions looked valid and confirmed well on the blockchain. The examiner passed the transactions. It caused about 40k ETC loss due to this attack. Gate.io will take all the loss for the users”, Gate.io also said in its tsatement.
On Friday the US based crypto exchange Coinbase, said that the attack on the Ethereum Classic network is still ongoing and that the stolen coins were nearly 222 000, worth over a million USD.
CoinMarketCap.com data shows that at the time of the Gate.io attack, the ETCUSD was trading between 4.90 USD and 5.25 USD.
Exchanges all over the world have discontinued ETC trade, but still none except Gate.io have reported any losses.