Founder of the Qubic blockchain, Sergey Ivancheglo, reported that Monero, the privacy-focused blockchain launched in 2014, is undergoing a 51% attack. Blockchain experts Charles Guillemet (CTO of Ledger) and SlowMist founder confirmed that the Qubic mining pool now has the majority control over Monero’s hashrate.
51% Attack — What it Means
A 51% attack is complete when an entity controls more than half of the network’s mining or validation power. Theoretically, Qubic can enable double-spending, rewrite blocks, and censor transactions. Hence, the attack has left users concerned about the integrity of the Monero Network. Historically, Qubic is the first to execute such an attack successfully.
Some blockchain analysts, such as the SlowMist founder, wonder what the Qubic team stands to gain given that the attack comes at huge costs. Guillemet estimates it would cost around $75 million per day to sustain such dominance. However, he noted that it is “potentially lucrative” but could shatter confidence and reduce Monero’s diverse miner ecosystem.
Why Launch the 51% Attack? Is it Over
While several users panic about the attack, Qubic has consistently framed it as a public, transparent demonstration of its useful Proof of Work (uPoW) model applied to Monero. Notably, the team has announced each stage and invited the Monero community “to prepare their defenses.” It hints that the operation is an engineering stress test and a safety exercise.
Given that the attack results in a network monopoly, the Qubic team has added incentives designed to attract miners. The protocol is offering higher Qubic rewards for mining through its pool, aiming to accumulate the hashrate needed to control the network sustainably.
The team plans to give half the mining profit to miners, dedicating the remaining to QUBIC buyback, which will be later burned. If the protocol succeeds in mining 100% of the Monero, it will potentially have daily earnings of 432 XMR, the native asset of the Monero network. Qubic’s control peaked at 52.72% of the total hashrate, achieved through its incentive model.
Market Reacts
Following the move, XMR tanked from $263 to $244, representing an 8% price decline. Notably, some investors panicked and liquidated their holdings. At Press time, the coin has climbed back to the $254 zone as it sits on a $4.68 billion market cap. So far, the Monero team has not commented on the recent developments.
On the other hand, its rival QUBIC has witnessed the opposite in price movement. The asset has gained over 5% within the past 24 hours, showing investor confidence in the crypto. Notably, its current market cap is $293 million, with a $9.85 million volume within the past 24 hours.
Meanwhile, in a related event, a hacker exploited a flaw in the Dogecoin network, knocking 69% of its nodes. The vulnerability allowed the attacker to crash node connections, crippling the network’s stability.
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