Coinbase researchers have released their own investigative findings into the recent Bitcoin Cash 51% attack controversy, and their conclusions might upset many Bitcoin maximalists.
When Bitcoin Cash came under attack during a scheduled hardfork in mid-May, a group of miners colluded to reverse the attacked blocks and return misappropriated funds to their rightful owners.
The Bitcoin Cash camp came under heavy fire for this move by BTC supporters. But Friday’s blog post by Coinbase suggests the global cryptocurrency platform ultimately saw good sense in the decision.
BITCOIN CASH 51% ATTACK: WHY IT MATTERS
The Bitcoin Cash upgrade was halted temporarily in early May when an attacker exploited a bug in the blockchain, a refresher can be found here. The attack lasted for a short while before a majority of BCH miners decided something fishy was afoot and took steps to address it.
This is where the controversy arose. Critics refuse to see the difference between an attacker reorganizing the blockchain, and miners doing the same.
For context, when Binance was hacked in early May, CZ suggested ‘rolling back’ the blockchain to retrieve the lost funds.
A backlash from Bitcoin miners at the time signaled to him that this was a bad idea, and the notion was dropped.
Here we have one of those points where the rubber meets the road in the crypto world. Blockchains are supposed to be immutable, but if enough miners agree to make a change, it can happen. In this instance, the maxim ‘code is law’ gets murky. After all, blockchains were designed to be malleable by the agreement of its users.
Others have made similar moves in the past – the reason we have Ethereum Classic (ETC) is because the Ethereum community split in two after a contentious hardfork in the wake of the DAO attack.
COINBASE: BCH MINERS DID THE RIGHT THING
Coinbase had their own interest in finding out what happened during the hardfork/attack, as BCH is major asset hosted on their platform. From the blog:
“On May 15th, Coinbase detected a depth-2 chain reorganization on the Bitcoin Cash blockchain. The reorg targeted BCH funds that were erroneously sent to BTC segwit addresses…”
Those funds totaled 3,655 BCH – equivalent to $1.4 million at the time. Most of these coins were safely recovered, and sent to their proper addresses by the BCH miners. This, it seems, was much appreciated by Coinbase. From the blog:
“We find it remarkable that BTC.top derived the technical solution to recover BCH funds mistakenly lost by users, choosing to send the coins to their intended recipients rather than claiming the funds for themselves.”
It was precisely because a less ethical miner attempted to move the stolen funds to their own address that BTC.top stepped in. BTC.top is one of the major Bitcoin Cash mining pools, representing around 10% of the BCH hashrate.