Monero Community Slashes Qubic's Hashrate from 1st to 7th in Economic Attack Pushback

Monero (XMR), a privacy-focused cryptocurrency, is confronting a contentious "economic attack" orchestrated by Qubic, a competing blockchain project led by Sergey Ivancheglo. The initiative, which aims to centralize mining power through financial incentives, has triggered a swift and forceful response from the Monero community. According to MiningPoolStats, Qubic’s hashrate share in the Monero network plummeted from first to seventh place within days after the strategy was exposed, reflecting the community’s coordinated resistance [1].

Ivancheglo, founder of Qubic and the IOTA cryptocurrency, openly admitted to leveraging his project’s network to incentivize Monero CPU mining, with the mined XMR funding buybacks and token burns for Qubic. In a June 30 blog post, he framed the approach as a means to "strengthen the Qubic economy" by tying real-world tasks—such as Monero mining—to value generation [2]. However, the strategy has been widely interpreted as an attempt to execute a hashrate takeover, potentially enabling Qubic to reject blocks mined by other pools and monopolize XMR profitability.

The attack’s mechanics hinge on economic manipulation rather than technical vulnerabilities. By offering miners rewards for aligning with Qubic’s network, Ivancheglo’s strategy exploits the financial incentives of Proof-of-Work (PoW) systems. In a X post, he acknowledged the move as a "war" on Monero’s mining ecosystem, asserting that such tactics could test the network’s resilience against future non-benevolent attacks [3]. Critics, however, argue that the approach undermines the decentralized principles of blockchain by introducing a new vector for centralization risks.

Monero’s community has reacted with skepticism and defiance. Reddit’s r/Monero forum highlighted the broader implications of economic attacks, warning that tactics like "selfish mining" could erode trust in decentralized networks. One user emphasized that ignoring such threats risks compromising the integrity of blockchain’s consensus mechanisms [4]. Meanwhile, independent analysts have echoed these concerns. Dan Dadybayo, an analyst at Unstoppable Wallet, noted that a 51% hashrate concentration would allow Qubic to orphan blocks, suppress competition, and force protocol changes. While Ivancheglo claims no malicious intent, Dadybayo stressed that "intent doesn’t matter" in decentralized systems, where centralization inherently creates vulnerabilities [5].

Ivancheglo’s actions have also drawn personal criticism. Monero community members on social media referenced his rumored location in Belarus, with some comments implying potential consequences for his role in the attack. Ivancheglo responded with a tongue-in-cheek remark about bounty hunters, hinting at the risks of devaluing XMR to zero [6]. His strategy now includes a covert phase: starting August 2, Qubic will cease reporting its hashrate, complicating efforts to assess the attack’s true scale. This move, he claimed, is to simulate the opacity of a non-benevolent attacker, though it has intensified concerns about transparency [7].

Monero’s governance structure, characterized by open-source development and community-driven decision-making, has enabled a rapid response to the crisis. Developers have proposed protocol upgrades to mitigate hashrate-based manipulation, though details remain under discussion. The community’s resilience, reinforced by Reddit’s active engagement, underscores Monero’s commitment to maintaining decentralization. Analysts suggest that the episode highlights a broader tension in the blockchain space: the balance between economic incentives and the security of decentralized networks [8].

The fallout from Qubic’s attack underscores the evolving nature of threats in the cryptocurrency landscape. While traditional 51% attacks rely on computational power, economic attacks exploit the financial dynamics of mining incentives. Monero’s stance—prioritizing privacy and decentralization—has positioned it as a test case for defending against such non-technical threats. As the standoff continues, the outcome may influence strategies for safeguarding other PoW networks against similar tactics.

Sources:

[1] [Monero 'Economic Attack' Saw Strong Community Response] [https://cointelegraph.com/news/monero-economic-attack-saw-strong-community-response]

[2] [Monero Faces Looming 51% Attack Threat From Rival Blockchain Qubic] [https://news.bitcoin.com/monero-faces-looming-51-attack-threat-from-rival-blockchain-qubic/]

[3] [Skepticism Sunday – July 27, 2025] [https://www.reddit.com/r/Monero/comments/1maijh5/skepticism_sunday_july-27-2025/]

[4] [Come-from-Beyond (@c___f___b) / X] [https://x.com/c___f___b?lang=en]

[5] [Skepticism Sunday – July 27, 2025] [https://www.reddit.com/r/Monero/comments/1maijh5/skepticism_sunday_july-27-2025/]

[6] [Monero 'Economic Attack' Saw Strong Community Response] [https://cointelegraph.com/news/monero-economic-attack-saw-strong-community-response]

[7] [Monero Faces Looming 51% Attack Threat From Rival Blockchain Qubic] [https://news.bitcoin.com/monero-faces-looming-51-attack-threat-from-rival-blockchain-qubic/]

[8] [Skepticism Sunday – July 27, 2025] [https://www.reddit.com/r/Monero/comments/1maijh5/skepticism_sunday_july-27-2025/]