Charlie Lee, the founder of Litecoin, has indicated that a decentralized cryptocurrency is defined by attacks. Lee’s views come at a time when the Ethereum Classic platform is recovering from a double spend scenario which was caused by a single miner controlling more than 50 percent of ETC’s hash power.
In a tweet, Lee stated that:
This is a thought-provoking observation. By definition, a decentralized cryptocurrency must be susceptible to 51% attacks whether by hash rate, stake, and/or other permissionlessly-acquirable resources. If a crypto can’t be 51% attacked, it is permissioned and centralized.
Cointelegraph noted that Charlie’s observation was a reaction to a revelation made by Coinbase, one of the leading cryptocurrency exchanges in the U.S, that Ethereum Classic, a decentralized cryptocurrency, had suffered a 51 percent attack leading to a double spend activity.
Initially, and as reported by Cryptolinenews, Coinbase had indicated that approximately $500 worth of ETC was spent twice. The exchange later updated the values citing more chain reorganizations were detected. The latest value from Coinbase now stands at approximately more than one million U.S dollars worth of ETC.
Although developers of the decentralized cryptocurrency, ETC, had said that it was just a hash power consolidation rather than a 51 percent attack, they later pointed the blame to Linzhi, an ASIC manufacturer. The developers said the manufacturer was testing “new 1,400/Mh Ethash machines,” something that the manufacturer has denied.
A number of cryptocurrency exchanges have since halted support for Ethereum Classic until the double spend issue has been addressed. However, some exchanges had already incurred some losses.
For example Gate.io, a crypto exchange:
Lost 40K $ETC with 51% attack. They will be covering the user’s losses.
Do you agree with Lee that a decentralized cryptocurrency cannot run away from a 51 percent attack?
Let us know your thoughts in the comments section below.