ZenCash attacks unleash security concerns about privacy currencies

A recent breach of double-spending attacks on ZenCash and other privacy currencies is leaving in evidence a possible security oversight that has already cost investors and traders millions and millions of dollars.

Source

A double-spending attack involves spending the same digital currency two or more times. This happens because each currency has a different file, which can be duplicated and / or falsified, it is a way of fraud through digital money that can impact the value of the real token depending on the number of copies of the same and the number of times that is falsified.

In the case of a double-spending attack, the attacker would typically deposit a currency in an exchange only to reverse the transaction in the block chain. Later, they deposited the original currency in a wallet without connection and, when the coin was counted in the stock exchange, they also removed the duplicated coin now laundered.

ZenCash (ZEN) focused on privacy joined the club "51% attack" at the time when the cryptocurrency was subjected to at least three double-spending attacks.

The official statement of ZenCash on the attack reads as follows :

"At the time of the attack, the hash rate of the Zen network was 58 MSol / s. It is possible for the attacker to have a private mining operation large enough to carry out the coup and / or supplement with rental hash power. The hash rate of the network is derived from the last mined block and therefore the live hash rate statistics are not available. "

ZenCash estimates that 23,152.3 copies of ZEN (almost 620,000 USD at the time of writing) were washed in three separate attacks, beginning late in the evening of June 2. A special examination to know the details of the different hacks is in progress at this moment.

According to ETHNews, "a 51% attack" occurs when a malicious agent takes control of most of the coin network hash or computing capacity.

The attacker can reorganize the block chain of the network to accept fraudulent blocks, or blocks legitimately extracted but claimed by the attacker. As the hacker's version of the blockchain is now growing faster than the original, the network accepts the fraudulent chain as legitimate because it has the longest PoW series. "

The 51crypto website has recently tested how much it would cost, using the computing power in a rental cloud, to achieve a 51% attack on a PoW network. Although theoretically at the time of writing it would cost more than 735,000 USD per hour to attack Bitcoin, it would only cost around 8,000 USD per hour to attack ZenCash. Other currencies that also recently succumbed to 51% of attacks, among them Verge (XVG) and Bitcoin Gold (BTG)

These types of attacks come at a time when many governments are cracking down on privacy currencies. Citing concerns about security and fraud, exchanges in Japan and South Korea recently excluded Monero, Zcash and Dash, among others from their platforms for the regulatory scrutiny that could come.

Source: ETHNews