Owner of Ethereum Classic (ETC) is cautiously watching mining activity on its blockchain, as the impending merger of Ethereum (ETH) and its transition to the proof-of-stake consensus mechanism puts more attention on the six-year-old cryptocurrency.
The drastic jump in activity may signal a change in focus for cryptocurrency miners. It could also reduce the risks of a so-called “51% attack” on ETC, which has been imposed on the blockchain before.
The hashrate of the Ethereum Classic network — a measure of the computational power per second used when mining a cryptocurrency — hit an all-time high on Thursday. According to data from the crypto market information company MessariThe ETC hash rate was 42 terahashes, or 42 trillion hashes per second.
The previous high was 28.32 terahasshes last May, which coincided with ETC’s record high price of $118.
A likely reason for the increased activity is the fact that the merger will leave Ethereum miners in the stitchwith expensive hardware designed for proof-of-work blockchains that are useless in the new proof of effort model. While some miners wants create a hard fork of Ethereum to maintain their livelihoodothers can redeploy their equipment to mine other proof-of-work cryptocurrencies, such as Ethereum Classic.
Ethereum Classic is a fork of the Ethereum blockchain that was launched after the Ethereum blockchain had to be rolled back and relaunched in 2016 after hack of the DAO projectcausing a split within the Ethereum community.
Ethereum Classic risk of attack
Since Ethereum Classic isn’t among the biggest cryptocurrencies — hovering around 19th by market capitalization, according to CoinGecko — many crypto analysts worry that it’s vulnerable to a 51% attackwhere a single party or group can take control of a blockchain by handling the majority of transaction validations.
While any blockchain can conceivably face this type of attack, they are more prevalent in work certificate blockchains such as ETC, Bitcoin and – at least in the next few weeks – ETH. However, a 51% attack on Bitcoin is unlikely due to the size of the blockchain and unreasonable cost of the necessary computing power.
ETC has been targets in such attacks previously, in January 2019 and August 2020.
“Earlier today, @eth_classic $ETC experienced a chain reorganization of 3,693 blocks,” Binance wrote on Twitter in the latter case. “Our alert system caught this immediately and automatically stopped withdrawals and deposits. It looks like it could be a 51% attack.”
Earlier today, @eth_classic $ ETCexperienced a chain organization of 3,693 blocks.
Our alert system caught this immediately and automatically stopped withdrawals and deposits.
It looks like it might be a 51% attack.
We will update you as things develop.
— Binance (@binance) August 1, 2020
Cryptoanalysts have assessed the risks of another attack on Ethereum Classic during the merger era. A contributor to the Ethereum Classic codebase, meows bitsrecently published a detailed risk assessment of 51 percent attacks against ETC.
“Ethereum plans to move to Proof of Stake in the near future, which will force out its mining interests,” the report notes. “As the second largest cryptocurrency application of this hash power, it stands to reason that ETC expects its hash rate to be boosted by at least some of these abandoned miners.”
“If Ethereum Classic achieves the position of the dominant application of hash power, its risk exposures would decrease to a minimum,” it adds.
In other words, the recent surge in activity on the ETC blockchain is a good sign, as a high hash rate protects network from attack.
As for the cryptocurrency itself, ETC beat one four month high earlier this month, attributed to the ongoing merger. Currently, the trading price of ETC is $36.36, according to CoinGecko.
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