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Coinbase delays Ethereum Classic transactions after two 51% attacks

Coinbase will delay all Ethereum Classic (ETC) transactions after the network suffered two 51% attacks last week, with hackers stealing millions in ETC.

Coinbase delays Ethereum Classic transactions after two 51% attacks

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Coinbase will delay all Ethereum Classic (ETC) transactions after the network suffered two 51% attacks last week, with hackers stealing millions in ETC.

The San Francisco-based exchange said on a tweet the confirmation time for ETC sent to Coinbase and Coinbase Pro is now set at 2 weeks after the recent network attacks. It added they were monitoring the situation.

The decision came after hacker/s stole over $5 million worth of Ethereum Classic โ€” spread over two attacks โ€” by gaining control over the majority of the network and performing a block reorg.

Ethereum Classic attacked over four days

According to an investigation by on-chain firm Bitquery this week, Ethereum Classicโ€™s second 51% attack on Thursday saw hackers reorganize over 4,236 blocks (worth $3.3 million) and successfully double-spend $1.68 million worth of ETC.

The attacker pocketed an additional 14,200 ETC via block rewards during the event. The hashpower required for the attack was obtained from Nicehash DaggerHashimoto โ€” the same as the first attack โ€” said Bitquery.

Thursdayโ€™s event followed an earlier attack on August 1, which was thought to be a software error at the time. The report estimates the hacker reaped more than a 2,800% return for his efforts, having spent roughly 17.5 Bitcoin (BTC) worth $192,000 on renting hash power from Nicehash to execute the attack.

Meanwhile, Bitquery stated the attack took between July 31 and August 1, but remained detected for โ€œseveral days as a result of intricate planning and knowledge of the Ethereum Classic protocol.โ€

The report stated:

โ€œThe hacker began the attack by transferring ETC from an exchange wallet under its control, and then back again.โ€

Criminal action and an OKEx connection

Ethereum Classic Labs, the core development organization behind Ethereum Classic, said Friday it engaged law firm Kobre & Kim to investigate and pursue strict criminal charges against the attackers behind the 51% attacks, according to a press release.

It said over eleven malicious transactions originated from a single address inserted into the Ethereum Classic blockchain over the attack, allowing more than 807,000 ETC to be double-spent.

Bitquery added the attackersโ€™ addresses may be hosted on either OKEx or one of the exchangeโ€™s affiliated companies. This has not been confirmed by the exchange.

Meanwhile, Ethereum Class Labs said organizations can utilize several measures to prevent further disruption to the network:

Investigations are ongoing.

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