Altcoins

A Warning Of a 51 Percent Attack On Bitcoin Cash Has Been Reported. Could Prove to be a Real Risk

A Warning Of a 51 Per Cent Attack On Bitcoin Cash Has Been Reported. Could Prove to be a Real Risk

The average hash-rate of Bitcoin Cash (BCH) has fallen below 8 percent of Bitcoin’s (BTC) over the past week. Blockstream compares the altcoin to a five-year-old Litecoin hard fork.

Over the past weeks, Bitcoin Cash has had some major announcements. BCH is a fork of Bitcoin, and some say it is a better and faster version of Bitcoin. Two weeks ago, UK Exchange Launches First FCA-Regulated Bitcoin Cash Futures Contracts. The Bitcoin Cash/US Dollar futures will enable investors to take long and short positions in the cryptocurrency which allows them to broaden the opportunities since the market is very volatile, and therefore hedge their risk more effectively.

The great news does not stop there for Bitcoin Cash; the coin has passed the stress test of 2,3 million transactions per day. Scalability is one of the major obstacles for cryptocurrencies at the moment for mass adoption of the blockchain technology. Reaching 2,3 million transactions is a step in the right direction for Bitcoin Cash,

Ledger Nano S - The secure hardware wallet

However, a warning arrived on a comment on Twitter today. Blockstream VP solutions lead Warren Togami sounded the alarm over Bitcoin Cash. The coin has an abnormally low hash rate that places the investors at risk for double-spending attacks.

Togami issued a while back, warning words on the altcoin, when the hash-rate was as low as 12 percent of Bitcoin and exchanges were crediting transactions after just one network confirmation. A move he described as very dangerous.

According to Togami:

“BCH meanwhile has 12% hash-rate of BTC while some exchanges credit BCH deposits after one confirmation. This is dangerous as there exist INDIVIDUALS with enough hash power to attack the BCH network. A hacked individual or pool could render an exchange insolvent”.

By looking at history, we can understand the danger of the situation. The state of Bitcoin Cash is similar to the case of Feathercoin – that forked from Litecoin in April 2013. After a 51 percent attack in June, the same year lead to its destruction, and FTC collapsed, becoming worth less than one cent for the next three years. It was launched for 50 cents.

Togami means that the parallels are clear.

“FTC forked from LTC, competed for script hashes,” he continued, adding that “like BCH,” FTC had an “incompetent” developer.

The figures behind Blockstream have often taken an active stance against Bitcoin Cash developers for their claims to be superior Bitcoin.

Image Source: “Flickr” 

Ledger Nano S - The secure hardware wallet