Verge (XVG), a privacy-focused cryptocurrency has suffered yet another hacking incidence and a total of 35 million XVG lost. The company made news when pornhub.com started accepting it as a method of payment. Before that, the company’s protocol had been hacked in which millions of dollars were lost.
In the first hacking incidence, which happened in April, the attackers made 250,000 XVG. As a reaction to the news, the coin lost 25% of its value. The April attack was resolved when Verge developers accidentally initiated a hard fork. The company’s Twitter account was also hacked in March and the hackers started issuing tweets about a fraudulent offer of Verge coins in exchange for coins.
How the Hack Worked
The company accepts blocks with up to 2 hours timestamp away from the latest block time. The attacker was using a fake timestamp to submit the blocks which are older by one hour. The mining adjustment algorithm only accounts for recent blocks. This made difficulty fall to very low levels and slide by 99.99%. The attackers managed to mines coins that could be mined in weeks in just two hours.
The most worrying part is that the hackers managed to take over the whole network and were able to produce blocks using only one of the blocks. This mining approach is the one used to mine in Litecoin (LTC). The method is very common that an ASIC has been in existence for some time.
Although other users of the Verge network were mining using consumer electronics, the network could only take a few ASIC on the whole hashing power of the network.
The XVG difficulty has since been recovered but it is very low as compared to a month ago. Despite the attack, no transactions have been rolled back. The aim of the attack was the mining bounty valued at $1.7 million in the market.
After the attack, the market has gone down to 13.97% in the last 24 hours. The coin is currently trading at $0.0451 and has a market cap of over $677 million.