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In this Zcoin review we will be taking a look at another interesting anonymity coin that has been rolling out developments recently.

ZCoin is one of the major privacy coins that attempts to establish anonymous transactions, fungibility and decentralization of mining in a unique and scalable way.

Originally the Zerocoin protocol was developed to be an extension of Bitcoin, but when it wasn’t adopted by the community it was released as a coin and blockchain of its own.

With ZCoin you can spend without any transaction history or link to your identity. This is a dramatic improvement on privacy versus Bitcoin, where addresses are made transparent to combat the double spending problem.

Zcoin and the Zerocoin ProtocolImage via Wikipedia

The idea for the Zerocoin protocol came from Johns Hopkins professor Matthew D Green and two of his graduate students – Ian Miers and Christina Garman. While it was proposed as an improvement for Bitcoin, it never gained consensus, and so in September 2016 Poramin Insom released a blockchain and cryptocurrency using the idea of the Zerocoin protocol.

Zcoin is unrelated to other cryptocurrencies utilizing the Zerocash Protocol. Although Zerocash is a development from Zcoin’s old protocol Zerocoin, their respective implementations are not simple forks of each other, but rely on different cryptographic assumptions with various tradeoffs

Because it was developed as a Bitcoin improvement, sending ZCoins works exactly like Bitcoin and the transactions are recorded in a public ledger. However the Zerocoin protocol uses minting to make these transactions anonymous. Basically, ZCoin requires that you mint Zerocoin before you are able to spend.

These new Zerocoins have no transaction history, and because there are so many users minting coins at the same time it becomes impossible to trace the newly minted coins to any particular user. It has been likened to a type of money laundering, where the old coins are destroyed, and the newly minted coins are untraceable.

The Sigma ProtocolThe Sigma Protocol was implemented in July 2019 and replaced the Zerocoin Protocol.

Zcoin is the first full implementation of the Sigma Protocol, which allows users to have complete privacy via zero-knowledge cryptographic proofs. One of the main benefits of the Sigma protocol is that it has removed the need for the trusted setup.

The trusted setup is something that other cryptocurrencies such as ZCash have had to rely on through their "Ceremony". This has also been one of the major bones of contention for the security of the ZCash blockchain. You will really have to believe that the setup was done correctly in order to trust it.

By removing this trusted setup, the Sigma protocol places Zcoin at a unique advantage.

The Sigma Protocol is a precursor to the next-gen privacy protocol Lelantus being developed by the ZCoin cryptographer Aram Jivanyan which will further build on Sigma and greatly expand its functionality and privacy features by removing the need for fixed denominations in minting and spending.

You can learn more about the Sigma Protocol here.

Zero-Knowledge ProofsZerocoins uses something known as Zero-Knowledge Proofs to help maintain anonymity. Cryptography defines a zero knowledge proof as a method for one party to prove to another party that they know what the value of x is without having to share any additional information aside from the fact that they know what the value of x is.

One simple way of demonstrating this definition is to prove to a friend that you know your Gmail password without telling them what it is by logging into your Gmail account. This would prove you know what the Gmail password is, without giving any additional information.

Image Source: Zcoin Blog

Zero knowledge proofs work for ZCoin in showing proof you own the Zcoin you are sending, without letting anyone know the source of those ZCoins.

How Zerocoin Achieves AnonymityWhen a Zerocoin is minted it destroys a ZCoin in the process. When this occurs the Zerocoin protocol generates a random serial number “R” and a secret number “s”. These randomly generated R and s are then used in a cryptographic function to generate a value “V”, which you become committed to.

The V value is posted to the blockchain to prevent it from being changed in the future. This value V is publicly viewable, as are all the other V values being created by people who are minting.

Now to spend the Zerocoin R a zero knowledge proof is given showing your R value corresponds to the public value of V. This zero knowledge proof only shows that there is some V corresponding to your R, but it doesn’t reveal which one. This allows Zerocoins to be spent without anyone being able to determine their origin.

To avoid double spending of Zerocoins, Znodes verify that the zero-knowledge proof was valid and that Zerocoin R was not previously spent.

Mining ZCoinZcoin began using the Lyra2z algorithm for proof of work, but recently moved to the Merkle Tree Proof of Work algorithm (MTP) to address several problems.

MTP Compared to Other Algorithms. Image Source: YouTube

MTP is known as a memory hard algorithm and it has several benefits, one of which is the prevention of the development of ASIC chips which could lead to centralization of mining. It also helps prevent infecting computers and making them part of mining botnets. The founder of ZCoin has the following to say:

The basic concept is that it should establish the same price/cost for a single computation unit on all platforms meaning that there is no single device that should gain a significant advantage over another for the same price hence promoting egalitarian computing

So, the goal is to keep ZCoin feasible for CPU mining as a way to decentralize the security of the network. The MTP being used by ZCoin has also been made less memory intensive than previous versions, and it is less vulnerable to DOS attacks. That said, the ZCoin team isn’t against GPU mining, but with MTP CPU mining remains competitive even if GPU mining is also utilized.

If you want more information then you can read our comprehensive guide on mining ZCoin.

Founder’s RewardThe Founder’s Reward was implemented to fund the development of ZCoin, and it specifies that for the first four years 14% of mined ZCoins will go to the Founder’s Reward pool. That 14% will be split as follows:

ZCoin Team received 6%Seed Investors receive 6%ZCoin Founder Poramin Insom receives 2%Once the first four years have passed (in September 2020) the block rewards will revert to going entirely to miners and Znodes.

ZnodesZnodes are similar to master nodes in that they are computers on the ZCoin network that are running a full copy of the blockchain, and are working to process transactions. The Znodes are incentivized by receiving 30% of newly minted ZCoins, currently 7.5 per block.

Those running Znodes are required to stake 1,000 ZCoins however, as a way to prove that they are highly invested in the ZCoin network. The stake is an incentive to keep the network running honestly and with consistent uptime.

Before & After ZNodes on ZCoin

As of August 30, 2019, the rate of return for running a Znode is roughly 15.8% based on data from Masternodes.online. It estimates that a node will receive a reward every 17 days 7 hours 50 minutes.

With the price of XZC currently at $5.82 monthly income for running a Znode is roughly $75. This is based on 4,990 active master nodes. If the number of master nodes increases the payout would decrease and vice versa.

Coin Supply and SustainabilityBecause ZCoin was based on Bitcoin, there were 21 million coins originally meant to be created, however, a bug in the code led to the creation of an additional 388,450 coins. That bug has been fixed and the maximum supply of ZCoin is now set at roughly 21.4 million. As of August 2019, the circulating supply of ZCoin is 8,261,093 XZC.

Like Bitcoin, ZCoin began with a block reward time of 10 minutes, however, that was decreased to 5 minutes as of June 2018. Currently, there are 25 coins awarded per block. This award will halve roughly every 4 years until all of the ZCoins have been minted. Once all coins have been minted miners will continue to be rewarded through transaction fees.

Zcoin TeamWhile Matthew Green originally came up with the idea for ZCoin, the implementation was the work of Poramin Insom. At the time he was working under Matthew Green at Johns Hopkins, which made for a perfect mentor relationship.

Prior to developing ZCoin, Poramin developed Vertcoin, but he moved to work on ZCoin as he saw a need for anonymous transactions in the cryptocurrency space. He plans to eventually return to the development of Vertcoin, but is fully focused on ZCoin for the time being.

From Left: Poramin Insom (Founder), Peter Shugalev (Lead Dev), Tadhg Riordan (Solidity Dev), Snguyen (Dev)

The lead developer of ZCoin is Peter Shugalev, a software architect and programmer who brings over 15 years of experience to the ZCoin project. Based in Moscow, he has a Masters degree from Moscow State University in Computer Science and Mathematics and has even created his own programming language which was used in a signature-based intrusion detection system.

On the business side, the COO of ZCoin is Reuben Yap, a corporate lawyer for 10 years, who joined ZCoin in October 2016 and has been pivotal in shaping the vision and direction of the ZCoin project.

He is very well-versed in blockchain privacy protocols and spends a good deal of time traveling and speaking about them in a simple and easy to understand manner. He has long been a proponent of privacy and was previously the founder of one of the top VPN services in SE Asia (bolehvpn.com).

The XZC TokenThe XZC token got off to a strong start, opening in October 2016 at just above $0.90 each. Within a week it was trading above $5, and at the end of the second week, it had rallied to $8. It couldn’t hold those levels, however, and by November it had slid back down to trade under $1.

It continued to slide throughout the remainder of 2016, although there was also a good deal of volatility, and the price was apt to change by as much as 30-50% within a matter of days.

As 2017 got started XZC had rallied back above the $1 level and was soon trading back above $2 as well. It continued climbing and June/July 2017 saw it trading in a range of $10-$20. There was a drop back under $7 in August, but XZC soon recovered, trading from $10-$15 throughout the autumn of 2017.

XZC Price Performance. Image via CMC

Price really began to take off in November 2017 and as is the case with most cryptocurrencies, ZCoin saw a huge run-up in price during December 2017, hitting a high of $169.99 on December 26, 2017. Since then the price has retraced quite a bit, and with the exception of a bounce in April 2018 has been steadily moving lower.

As of August 2019, one ZCoin (XZC) is worth $5.83, with price moving steadily lower for most of 2018, with a low of $4.21 hit in December. Price recovered in early 2019 and by June was trading near $15. It spent June and much of July trading in a range of $10 to $13 but then retreated along with the broader crypto markets.

Buying & Storing XZCThe largest trading volume for ZCoin (XZC) can be found on MXC, although there is also a good amount of trading volume on the CoinEx platform. CHAOEX also has a good deal of volume, and beyond that, you can get XZC at Binance, DigiFinex, Huobi Global and a number of other smaller exchanges.

In terms of volumes, it is relatively well split out on the exchanges although over 80% is concentrated in the top 3. There is decent liquidity though with healthy order books that are quite deep. This means easy execution for the large block orders.

Register at Binance and Buy XZC Tokens

The ZCoin project does have an official desktop GUI wallet, which is probably the best choice since it has built-in mint and spend functions. There is also an Electrum light wallet available.

For those who prefer mobile wallets, there are a number of choices including the Trust Wallet, Coinomi, Edge Wallet, Cobo Wallet and a number of others.

Plus the ZCoin developers are working on a native mobile wallet that is expected to be released by the end of 2019. Both popular hardware wallets, the Ledger and Trezor, also support XZC.

ZCoin Developement & RoadmapSomething that I sometimes like to do in order to determine the development progress on a project is to look into their GitHub repositories. By observing how much code is being pushed, one can get a good idea of exactly what is being done.

Hence, I decided to jump into Zcoin's official GitHub. Below are the code commits for the top three most active repos in their GitHub. These are the total number of commits pushed in the past year.

Commits to select repos over past 12 months

As you can see, they have been quite active with a regular stream of commits. There are also a further 66 other repositories with varying degrees of activity.

This level of development is more than we have seen on other projects at similar stages. In fact, if we were to compare Zcoin to other projects based on the total number of commits, it comes in at number 52.

This of course makes sense given that there were a number of updates that the Zcoin developers have recently been working on. The prime among these is of course the Sigma protocol which is finally out.

There are also some really exciting updates that are planned in their roadmap. Below are some of the most notable updates still planned for 2019.

Overhaul of User Interface: A new GUI wallet is on the way that will be based on Vue.js.RAP: Receiver Address Privacy: This will allow users to share one static public address that will route transactions to brand new addresses. This will preserve privacy and has not been used by any other privacy coin.Encrypted Node Communications: This encrypted node communication will allow Zcoin traffic to be censorship resistant.MTP Revamp: They will improve on MTP in order to further the ASIC resistant featuresNative Mobile Wallet: Launch of a mobile wallet that will have full privacy supportThen, heading into 2020 one can expect to see research on scaling, governance and quantum resistant algorithms. If you wanted to keep up to date with the development then you can head on over to their official blog.

ConclusionZCoin sees some advantage from having code that is based on Bitcoin’s core code. It makes it easier for the project to implement changes that Bitcoin makes. And the anonymity factor is certainly a big deal, especially in countries such as China, where privacy is difficult to come by.

As Western nations begin to regulate cryptocurrencies there is a good chance that privacy will become increasingly important across Europe and in the U.S.

While some have complained about the Founder’s Reward being included in ZCoin, there are other cryptocurrencies out there who have implemented similar features.

After all, the development team needs funds if they are to continue working on ZCoin, and Insom himself admitted that the reason he had to halt work on Vertcoin was from lack of funds. In any case, there’s only one more year until the Founder’s reward is done, and I’m betting five years from now no one will even remember the Founder’s reward.

A dedicated founder and lead developer, combined with funding for development, and a solid roadmap makes ZCoin’s future look bright.

Disclaimer: These are the writer's opinions and should not be considered investment advice. Readers should do their own research.

Coinbase, Kraken and other cryptocurrency exchanges are taking positions on proof-of-work consensus and Bitcoin mining. Despite criticisms against proof-of-work, they argue there is little risk of centralization-induced attacks.

Proof-of-work is one of Bitcoin’s core features which allows to reach consensus and keep the blockchain secure. Miners are responsible for finalizing transactions and generating new Bitcoins. However, proof-of-work isn’t perfect – to its critics, it’s a system that results in centralization of power.

Though there are alternatives, proof-of-work is here to stay as far as Bitcoin, Litecoin, Monero and many other cryptocurrencies are concerned. Proof-of-work largely operates behind the scenes, but it can have far-reaching effects — which has led some exchanges to weigh in on the matter.

Coinbase Endorses ASIC Mining Coinbase has recently argued that proof-of-work networks can benefit from ASIC mining. This is a controversial claim — it’s widely held that ASICs bring about monopolized ownership because they are specially designed to mine certain coins. CPUs and GPUs, by contrast, are general purpose chips that are available to anyone who owns a computer.

However, Coinbase sees things differently. It argues that general purpose hardware is a greater threat to centralization. There are many GPUs and CPUs that are not being used for mining, and these could suddenly be harnessed to attack a mining network. ASIC devices, which are only useful for certain types of mining, can’t suddenly join a network en masse.

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Coinbase adds that Bitcoin Gold, Vertcoin, and Verge have fallen victim to 51% attacks despite attempts to become ASIC-resistant. The company suggests that coins should bring about decentralization in a different way — they should instead turn to ASIC-friendly algorithms that support affordable manufacturing and turn ASICs into a widespread commodity.

Coinbase concludes that ASIC mining is inevitable: “Participants have to ask themselves if the industry is going to be secured by hobbyists running old laptops,” it insists. “Every at-scale, professional industry utilizes specialized equipment — it is naive to think that cryptocurrency mining will or should be any different.”

Kraken Argues Mining Pools Are Secure Kraken has published its own in-depth report on mining mentioning centralizing effects of mining pools. At the time of its publishing in April, many people were concerned that a few major mining pools could coordinate a 51% attack due to their hashrate dominance. That fear has intermittently come and gone.

Kraken argues that there is little reason to fear such an attack. It believes that heavily invested miners cannot carry out an attack sustainably as the effects on market price would devalue any profits. “We believe there is a greater incentive for [pools] to conduct honest operations and uphold the value of the network,” Kraken says.

Citing rules of game theory, Kraken suggests that dishonesty is a poor strategy for miners: “Any deviation will certainly result in short-term cost with unpredictable compensation.” It also notes that pools don’t have guaranteed dominance —since users can switch between pools, new pools can form to deter collusion.

Other Exchanges Are Also Getting Involved Some exchanges have attempted to get involved in mining more directly. Huobi, for example, runs a mining pool that accounts for 6% of Bitcoin’s hashrate, while OkEX runs a much smaller pool. Though they are not very significant, their existence does indicate that exchanges are interested in taking on big, Bitmain-owned mining pools.

BitMEX, meanwhile, is trying to keep mining security in check. It runs Forkmonitor.io which scans Bitcoin and its forks in real time for unusual activity. BitMEX Research also covers various mining-related issues, some of which are quite obscure and gain very little coverage elsewhere.

Finally, Binance has courted controversy by overstepping boundaries. After it suffered an attack in May, Binance briefly considered incentivizing miners to undo the theft. Binance eventually refrained from pursuing that plan — while miners showed no interest in complying. However, the event did raise the question of whether mining is truly irreversible.

Why Exchanges Care About Proof-of-Work Exchanges typically have no direct influence over mining and proof-of-work. They can only suspend trading activity and block bad actors if an attack or vulnerability occurs. Coin developers are ultimately responsible for designing proof-of-work schemes that produce a decentralized, accessible, and secure mining network.

Instead, exchanges are concerned with mining because they adjust their services around each coin’s proof-of-work model. For example, Coinbase recently decided that it is safe to reduce its confirmation times for Bitcoin, Zcash, and Ethereum Classic. On the other hand, exchanges like Bittrex have delisted attack-prone coins entirely.

Some investors make decisions about which coins to invest in based on technical matters such as proof-of-work. Though exchanges are naturally concerned with market data, they often tend to keep investors informed about technical matters — a level of dedication to the public that often goes unnoticed.

Disclosure: This article was edited by Mike Dalton. For more information on how we create and review content, see our Editorial Policy.

Vertcoin 51% Attack ‘Motive Uncertain’ as Hackers Lose up to $4,000

A second 51% attack on Vertcoin was just attempted earlier today The hackers (unknown) ended up paying for the attempt out of their own pockets!

The hackers seem to have come out of this whole ordeal $440 worse off. A second 51% attack on Vertcoin was just attempted earlier today but the hackers (unknown) ended up paying for the attempt out of their own pockets!

Turns out, crime DOES pay… just not in the way they intended...

51% Hacking

The lead maintainer on Vertcoin, James Lovejoy revealed that a malicious person(s) targeted the crypto platform Bittrex. This was in order to try and force a manipulative manner onto the Vertcoin blockchain.

In 2014, the cryptocurrency left Bitcoin in the form of a fork. This led to a major attack in December of last year in which a whopping $100k was stolen by hackers.

But the exploit attempt this year has clearly been a whopping fail instead.

“Based on the market prices during the attack's preparation and the difficulty of the blocks the attacker produced, we estimate the attacker spent between 0.5-1 BTC to perform the attack,” Lovejoy explained. 

The hackers seem to have come out of this whole ordeal $440 worse off. That’s at the very least too, $4.1k is the most they could have reportedly lost.

“The total value of the block rewards the attack received is 13825 VTC (~0.44 BTC). Given the attack was likely not profitable to perform based solely on block rewards, the motivation for the attack is not certain.”

The Rise of Crypto

The rise in the price of cryptocurrencies has been often accompanied by an increase of general interest by big institutional investors. At the end of 2017, we saw a lot more people enter the market who probably never even heard of cryptocurrency and get involved with the space. Just as institutional investors got attracted into the space through the idea of money, hackers and scammers also jumped on the bandwagon...

For more news on this and other crypto updates, keep it with CryptoDaily!

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Cryptocurrency Vertcoin suffered another 51% attack

“Today we know that centralization and big bureaucracies have not, as promised, been the answer for promoting better opportunities for society” ~ Carlos Salinas de Gortari

To ASIC or not to ASIC has been the dilemma for years now. For some, the distinction is very easy; it comes down to choosing between centralization and decentralization. For others, it is about taking all the aspects of mining into consideration and opting for what’s best suitable for the end participants and the network altogether. With ASICs in the scene, one side of the coin depicts decentralization, the other side portrays centralization. A coin that’s puzzling not only to the ones in the cryptocurrency space, but also to the ones outside.

While there are many projects that completely oppose even the idea of ASIC mining, there is an equal number of projects or even more that have warmly embraced the new idea. And, why not? Decentralization means an open-market, which in turn symbolizes technological advancement.

Skating on thin ice On one hand, the argument that’s pro-ASIC is that “it contributes to the network security,” which is debatable. On the other hand, the argument that it leads to centralization of the network is something that’s hard to be brushed off. The security threats of ASIC mining centralization include ASIC boost, selfish mining, eclipse attacks, and launching a 51 percent attack without having 51 percent hash power (just by collaborating with three or four other mining pools). The problems of ASIC mining have taken a prominent seat in the crypto-market.

However, this is not the only factor that bothers miners and participants. There is only a portion of the community that can afford ASIC miners and the ones who can also have their table full with the question of whether or not their ASIC miners will be profitable by the time it ships.

The largest cryptocurrency, Bitcoin, is among those cryptocurrencies that have been pro-ASIC mining, and it is because of this very cryptocurrency that ASIC mining has gained a strong foothold in this space. The mining evolution from CPU to GPU to FPGA to ASIC completely superseded Satoshi Nakamoto’s “one CPU, one vote” rule.

Speaking to AMBCrypto, Bob Summerwill from ETC Cooperative said,

“If you see what’s been happening with every single cryptocurrency has ASICs, even the ones that claim to be ASIC resistant. And the reason is very simple, it just you can do it more efficiently. You are just doing a fairly simple algorithm and doing that in hardware is going to more efficient than doing it in software. There’s no going around that and the economic is such that you just cannot resist. It’s just futile to try and resist. The ASICs are going to happen anyway and they are actually good for you. So, resisting is futile and actually counter productive.”

While Bitcoin itself is relatively safe from the biggest problems of ASIC mining and centralization – 51 percent attack, the same, however, does not hold true for other cryptocurrencies. The reason is quite simple; the cost of BTC mining and the price is higher compared to the rest of p-o-w coins. In short, it’s possible, but it’s not quite feasible for the attacker considering there would also be a war against the rest 49 percent, and even if one percent hash rate is lost to the other side, it would mean game-over. Meaning, there’s zero economic incentive for launching a 51% attack on Bitcoin.

The Hash War A classic example of the blunders that can be caused by mining pools powered by ASICs is the Bitcoin Cash vs Bitcoin Satoshi Vision hash war that took place towards the end of 2018. Some market speculators even claimed that the hash war resulted in not only two different chains, but also the crash of Bitcoin’s price and hash rate towards the end of last year.

This was not the first time Bitcoin Cash got dragged into a mining war, nor was it the last time that BCH made headlines concerning matters related to mining. The cryptocurrency was itself a result of a fork war that took place in 2017 over the bigger block size argument. The latest on the shelf was this year’s report on re-org, carried out by BTC.com and BTC.top, with both pools joining hands to reverse blocks of transactions in order to cease an unknown miner from gaining access to coins, an exploit taking advantage of after May 15 hard fork.

Such instances show how the most important pillar of any cryptocurrency in the market, decentralization, can be undermined.

An achievable goal? While many are of the opinion that ASIC-resistance is futile, there are still projects that stand firm against ASIC-mining, keeping decentralization as the most important goal, even though there hasn’t been any substantial proof that this is an achievable goal.

Ethereum and Monero were the two coins that held the beacon of ASIC Resistance; Ethereum with back-and-forth discussion over implementing ProgPoW, and Monero with RandomX.

The Valladolid Debate

While ‘To ASIC or not to ASIC’ is a dilemma that the entire ecosystem faces, ‘to ProgPoW or not to ProgPoW’ is the question the Ethereum community is struggling with.

The reason to implement ProgPoW is simple, ASIC resistance, which even had a greenlight from the auditors. There are several reasons against it: debates of GPU miners buy-outs, Proof-of-Stake shift, and problems with the teams that proposed the algorithm.

Bob Summerwill said,

“When Ethereum was started it was like we don’t want ASICs, we don’t want to be like Bitcoin, we don’t want our mining to be dominated by a few of these Chinese companies. So, we are going to do something which is memory hard and runs on GPUs and not specialist hardware. It’s a different time now and I think what we’ve ended up inheriting there is not something that really makes sense anymore. The ASIC resistance is a myth. You can’t resist it.”

How does ProgPoW aim to answer the ASIC question? ProgPoW would have five key elements to its algorithm: change from Keccack_f1600 to Keccack_f800 [shift from 64-bit words to 32-bit words], the random sequence generated would change every 50 blocks, the DRAM would increase to 256 bytes from 128 bytes, adds reads from a small, and low-latency cache that supports random addresses.

ProgPoW would not eliminate the threat of ASIC mining. It would merely make it minimal by giving GPU miners a boost. The GitHub post reads,

“The design goal of ProgPoW is to have the algorithm’s requirements match what is available on commodity GPUs. If the algorithm were to be implemented on custom ASIC there should be little efficiency gains compared to a commodity GPU.”

The algorithm was supposed to make a debut this year with the Istanbul hard fork, but was postponed to the next one due to audit delays. Sailing through these troublesome factors, it is still unclear whether ProgPoW would ever make it to the Mainnet.

The ‘I have a dream’ of Monero

When Bitmain announced an Antminer designed for Cryptonight-based cryptocurrencies, it left the entire Monero community in a state of shock. If there was one thing that this community was sure of, it was that ASIC miners were a no-no.

The immediate response was to tweak the network algorithm on a constant basis, in this case – every six months. While the strategy did come at a cost – compromising the security of the network, it did work. In the ASIC-manufacturers‘ perspective, it would be pointless in terms of cost and effort to build an ASIC only to see the cryptocurrency change its algorithm to a different one.

Interestingly, the tweak in the mining algorithm brought an end to the popular crypto-jacking service, Coinhive, on 8 March 2019. The official announcement on the discontinuation of the service, stated,

“The drop in hash rate (over 51%) after the last Monero harh fork hit us hard. So did the ‘crash’ of crypto currency market with the value of XMR depreciating over 85% within a year. This and the announced hard fork and algorithm update of Monero network on March 9 has lead us to the conclusion that we need to discontinue Coinhive.”

The Monero community upped the ante with RandomX. The algorithm will be using all components of the core but not all of the chips, including the memory interface of the uncore; a difficult aspect to achieve for ASICs as it only focuses on one element in mining. The algorithm was changed from CryptonightR to RandomX at the end of November 2019. Its maiden voyage has been on easy waters so far. “Test fast, fail fast, adjust fast” has been Monero’s mantra so far.

Hit-and-miss

In December 2019, Vertcoin [VTC], ranked 306 on CoinMarketCap, recorded a 51 percent attack. Interestingly, the cryptocurrency has always been at arms against ASIC mining and had opted for Lyra2REv3 proof-of-work algorithm. Notably, this was not the first time the coin succumbed to the attack as the network faced a 51% attack in December 2018 too. A GitHub post on the attack stated,

“On Sunday, 1 December 2019 15:19:47 GMT 603 blocks were removed from the VTC main chain and replaced by 553 attacker blocks. We note that 600 blocks is the current confirmation requirement for VTC on Bittrex. There were 5 double-spent outputs in which ~ 125 VTC (~$29) was redirected. Each of the double-spent outputs are coinbase outputs owned by the attacker and it is unknown to whom the coins were originally sent before being swept to an attacker address after the reorg.”

Decentralized ASIC mining?

While the topic of ASIC centralization continues to be hot debate every now and then, Blockstream, a blockchain technology company, unveiled its mining colocation service and Blockstream Pool, earlier this year. In an episode of Magical Crypto Friends, CSO of Blockstream, Samson Mow, said that the pool would be contributing to Bitcoin’s mining decentralization as it utilizes BetterHash protocol. Mow had stated,

“So, you can run your own node at home, you can host your miners in a facility or you could have your own miners in your facility and then run BetterHash node that would connect to our pool and then it’s just more decentralized overall […]”

After all that’s said and done, the question here is not if ASIC resistance or mining is the way, but is Decentralization truly achievable?

Decentralization in mining is always going to be something that’s going to be hard to achieve as mining would always centralize in a place where electricity is cheap, farms with either CPUs or GPUs or ASICs are always going to exist.

“Maybe wars aren’t meant to be won, maybe they’re meant to be continuous.”

7 Altcoins You Must Withdraw From Poloniex (Or Lose Forever)

3 Days Left Before Poloniex Permanently Disables The Withdrawal of 5 Cryptos

Bitcoin Gold, a minor fork of Bitcoin, fell victim to a 51% attack last week, according to an independent report on GitHub.

Bitcoin Gold’s Low Hashrate to Blame As explained by Vertcoin maintainer James Lovejoy, the cryptocurrency suffered two deep reorganizations on Thursday, Jan. 23 and Friday, Jan. 24.

By buying out the blockchain network’s hashrate, attackers were able to steal approximately 7,000 BTG ($72,000) through double spending.

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Bitcoin Gold appears to be an easy target due to its low hashrate. Lovejoy suggests that the attack would have cost about $1,700 based on current Nicehash prices. Similarly, Crypto51 suggests it would cost about $700 to attack the blockchain.

The attacker succeeded in moving the stolen cryptocurrency to Binance, and may have succeeded in cashing out the stolen funds. However, Binance has also increased its withdrawal times for Bitcoin Gold to prevent future thefts.

This is not the first time that Bitcoin Gold has suffered a 51% attack: it was previously hacked for $18 million in May 2018, which led several exchanges to delist the coin.

Bitcoin Gold isn’t the only blockchain that has fallen victim to an attack. Lovejoy detected a similar attack on Vertcoin in December. He also discovered attacks on Expanse and Litecoin Cash over the course of 2019.

Other blockchains that have been targeted by 51% attacks in recent years include Ethereum Classic, Verge, and Feathercoin.

Disclosure: This article was edited by Mike Dalton. For more information on how we create and review content, see our Editorial Policy.