A notable surge in global hashrate control by Qubic, a project spearheaded by former IOTA co-founder Sergey Ivancheglo, has stirred discussions within the Monero community over potential security implications. Claiming to have obtained over 51% of Monero’s hashrate, Qubic’s achievement raises concerns about the risks of a 51% attack on the privacy-focused blockchain.
While Ivancheglo positioned this development as a stress test aimed at fortifying Monero against future network vulnerabilities, the announcement has ignited a vigorous debate among developers and security experts regarding the ramifications of such a significant hashrate concentration.
A 51% attack, where an individual or coordinated group controls a majority of a proof-of-work network’s hashrate, has previously caused disruptions in other cryptocurrencies like Ethereum Classic and Bitcoin Gold, resulting in substantial financial losses. The vulnerability of smaller networks like Verge to similar attacks underscores the destabilizing impact of concentrated hashing power on an entire cryptocurrency ecosystem.
Monero, known for its resistance to ASIC centralization through the utilization of the CPU-friendly RandomX algorithm, now faces new challenges with Qubic’s “useful proof-of-work” (uPoW) model. This model involves converting XMR mining rewards into USDT and using the proceeds to purchase and burn QUBIC tokens, creating a deflationary mechanism and bolstering liquidity within its ecosystem.
Qubic’s rise in network share from under 2% to exceeding 25% between mid-May and late July, occasionally topping pool rankings, has garnered attention. Ledger CTO Charles Guillemet has raised concerns about a potential 51% attack on Monero, pointing to signs of significant chain reorganization, while others in the industry like SlowMist founder Yu Xian have questioned the economic sustainability of Qubic’s approach.
As the Monero community deliberates whether this development signifies a hostile takeover or a strategic stress test, the market has responded negatively, with XMR experiencing a 6.65% decline in the past 24 hours and a cumulative 16% decrease over the preceding week.
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