Monero XMR Loses 13% After Qubic Pool 51% Attack Revealed

Monero (XMR) has recently faced a potential 51% attack, with the Qubic mining pool reportedly controlling a significant portion of the network’s hashrate. The incident, first highlighted by Yu Xian from SlowMist, suggests that the Qubic pool may have gained enough power to manipulate the blockchain, enabling theoretical chain rewrites and double-spending [1]. This has raised alarms among the cryptocurrency community, as such an attack undermines the integrity and security of the decentralized network.

Sergey Ivancheglo, founder of Qubic, acknowledged the situation, noting that the pool’s hashrate had initially peaked at 2.6 GH/s before dropping to 0.8 GH/s following a reported DDoS attack [1]. Despite this decline, the pool’s dominance in the short term is seen as a critical security risk. The potential for blockchain manipulation has prompted calls for increased decentralization, with community members urging miners to distribute their hashing power across smaller pools such as P2Pool [1].

The event has also had immediate financial implications. Monero’s price has dipped by 9.08% in 24 hours and by 27.02% over the past 90 days, according to available data, while its market capitalization remains at approximately $4.6 billion [1]. Charles Guillemet, CTO of Ledger, commented that a 51% attack has already occurred, contributing to a 13% decline in the asset’s value [2]. The attack is now being referred to as a significant setback for the Monero network, which had previously been celebrated for its strong emphasis on privacy and resistance to surveillance [3].

The Qubic mining group’s brief control over Monero’s network has been described as the result of a larger, ongoing dispute between the pool and the community. Prior to the attack, concerns had already been raised about the influence of a single mining pool on the network’s decentralization [4]. This suggests that the attack was not an isolated incident but part of a broader pattern of growing tensions.

Privacy-focused blockchains like Monero have historically been under greater scrutiny due to their anonymity features, which can be exploited for illicit activities [3]. The current situation highlights the difficulty in maintaining both privacy and security in blockchain systems, particularly when mining power becomes concentrated in the hands of a few actors.

An analysis from a Reddit user suggests that the profitability of 51% attacks may incentivize malicious actors to continue such actions until potential gains are exhausted [5]. This raises concerns about the long-term sustainability of proof-of-work (PoW) networks like Monero if mining centralization persists.

While the Monero community and developers have yet to issue an official response, the event underscores the importance of decentralization and community coordination in defending against potential threats to blockchain integrity [5]. The ongoing controversy is expected to influence future discussions around network governance and security in the cryptocurrency space.

Source: [1] Monero Faces Potential 51% Attack by Qubic Pool (https://coinmarketcap.com/community/articles/689b1419b37c0311606518be/)

[2] Monero (XMR) Faces Successful 51% Attack, Ledger CTO Says, XMR 13% Down (https://u.today/monero-xmr-faces-successful-51-attack-ledger-cto-says-xmr-13-down)

[3] Charles Guillemet - X (https://x.com/P3b7_/status/1955173****92984988)

[4] Qubic Mining Group Briefly Seizes Majority Of Monero Network Hashrate (https://financefeeds.com/qubic-mining-group-briefly-seizes-majority-of-monero-network-hashrate/)

[5] The incentive problem, RE: the ongoing 51% attack attempt (https://www.reddit.com/r/MoneroMining/comments/1mnuvqo/the_incentive_problem_re_the_ongoing_51_attack/)