Coinbase takes advantage of Vertcoin (VTC) 51% attack to hit its competitors

This is a guest post by Johter V. Seriaum


On the second of December 2018, a double spend attack was performed on Vertcoin. A large amount of ASIC hashrate was rented anonymously through rental services to attack the 4 year old blockchain. Things took an interesting turn, as it looks that Coinbase publically commented on the events, while dealing a blow to its competition such as Binance and Bittrex.

The Vertcoin blockchain experienced a series of successive reorganizations of the blockchain. On first sight, the attacks seem to be directed towards exchanges with the goal of stealing money, as if often the case with such attacks. However, given the relatively low volume on the Vertcoin trading pairs and the financial and legal risks that are associated with such attacks, it is highly unlikely that the attacks were initiated for financial gain.

Coinbase monitors the blockchain and responds in record time

In the post by Coinbase security engineer, Mark Nesbitt, a thorough analysis of the event of the attack are given. Coinbase has monitored at least 4 of the attacks and has provided details regarding the duration and suspected financial impact of the attacks. What is however more striking, is that Coinbase goes beyond describing the attacks and their primary implications. The Blockchain giant goes on to claim that any altcoin claiming to have similar properties to Bitcoin, is not being truthful and even states that ASIC resistance is futile.

While these claims can be arguable proven or disproven, it is clear that these comments seem out of place for such a large organization that has dominated the Bitcoin ecosystem for years.

How did Coinbase address other exchanges?

One hint as to why Coinbase takes this position comes towards the end of the article. They state that exchanges that support “these assets” will continue to be the victim of attacks. This jab at other exchanges, is clearly directed at the increasing competitive ecosystem of fiat on-ramps. Large exchanges like Binance, Bittrex and even smaller ones such as Vertbase have taken the fight to Coinbase.

They all seem determined to offer Fiat trading for more than just Bitcoin alone and all seem to focus on supporting a wide range of assets. Coinbase’s attempt to discredit competitive altcoin exchanges seems to be a direct attempt at protecting its market share.

 

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