{"id":175,"date":"2019-03-15T02:08:33","date_gmt":"2019-03-15T06:08:33","guid":{"rendered":"https:\/\/www.hodlin.com\/blog\/?p=175"},"modified":"2020-12-13T22:43:44","modified_gmt":"2020-12-14T03:43:44","slug":"a-blockchain-double-spend-affects-merchants-heres-how","status":"publish","type":"post","link":"https:\/\/www.hodlin.com\/blog\/a-blockchain-double-spend-affects-merchants-heres-how","title":{"rendered":"A Blockchain Double Spend Affects Merchants, Here&#8217;s How"},"content":{"rendered":"\n<p>True, crypto has been revolutionary. From being labelled as\na threat to traditional but dominant systems to wildfire misinformation that\nthese digital platforms are conduits for money laundering, the crypto and\nblockchain endures. <\/p>\n\n\n\n<p>Well, the community consists of extroverts and are aware that there are more threats to the network that word of mouth. Sometimes it is talked in low tones and was profoundly highlighted by the mysterious Satoshi Nakamoto. Said to be an existential threat, a 51 percent or a <a href=\"https:\/\/bitcoin.stackexchange.com\/questions\/4974\/what-is-a-double-spend\" target=\"_blank\" rel=\"noopener noreferrer nofollow\">double spending attack<\/a> is a dreaded occurrence. <\/p>\n\n\n\n<figure class=\"wp-block-embed-youtube aligncenter wp-block-embed is-type-video is-provider-youtube wp-embed-aspect-4-3 wp-has-aspect-ratio\"><div class=\"wp-block-embed__wrapper\">\n<iframe loading=\"lazy\" title=\"What is Double Spending\" width=\"500\" height=\"375\" src=\"https:\/\/www.youtube.com\/embed\/cOc7V64HUDQ?feature=oembed\" frameborder=\"0\" allow=\"accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share\" referrerpolicy=\"strict-origin-when-cross-origin\" allowfullscreen><\/iframe>\n<\/div><\/figure>\n\n\n\n<p>A while back, Ethereum Classic, a coin so endeared and even\nhas the prestigious support of CoinBase was \u201cdeep chain re-organized\u201d. This <a href=\"https:\/\/medium.com\/ludos-protocol\/etc-double-spending-attack-incident-the-final-straw-to-overwhelm-pow-mechanism-8da9fd755828\" target=\"_blank\" rel=\"noopener noreferrer nofollow\">reorganization<\/a> (a\neuphemism for a double spend) was striking, news line making and a scary event\nfor ETC holders. It was because for every double spending event\u2014an event where\none can spend a coin TWICE\u2014or in technical terms use the same inputs of a\nbroadcasted transaction twice\u2014it means the legitimacy of the network is put in\nserious doubts. <\/p>\n\n\n\n<figure class=\"wp-block-embed-twitter aligncenter wp-block-embed is-type-rich is-provider-twitter\"><div class=\"wp-block-embed__wrapper\">\n<blockquote class=\"twitter-tweet\" data-width=\"500\" data-dnt=\"true\"><p lang=\"en\" dir=\"ltr\">On 1\/5\/2019, Coinbase detected a deep chain reorganization of the Ethereum Classic blockchain that included a double spend. In order to protect customer funds, we immediately paused movements of these funds on the ETC blockchain. Read more here: <a href=\"https:\/\/t.co\/vCx89dz44m\" target=\"_blank\" rel=\"noopener noreferrer nofollow\">https:\/\/t.co\/vCx89dz44m<\/a><\/p>&mdash; Coinbase \ud83d\udee1\ufe0f (@coinbase) <a href=\"https:\/\/twitter.com\/coinbase\/status\/1082364714246582274?ref_src=twsrc%5Etfw\" target=\"_blank\" rel=\"noopener noreferrer nofollow\">January 7, 2019<\/a><\/blockquote><script async src=\"https:\/\/platform.twitter.com\/widgets.js\" charset=\"utf-8\"><\/script>\n<\/div><\/figure>\n\n\n\n<p>CoinBase were the first to pick up this attack stating that\nthe motive was for-profit and not an act of malice from ASIC miners who secure\nthe network. But here is the misconception when a double spending attack\nhappens. It is not the coins\u2014in this case ETC\u2014that are stolen. Instead because\nperpetrators have an upper hand and control 51 percent of the network\u2019s hash\nrate, they can at their pleasure\u2014as long as they have this majority\ncontrol\u2014reverse transactions paid in ETC. <\/p>\n\n\n\n<figure class=\"wp-block-embed-twitter aligncenter wp-block-embed is-type-rich is-provider-twitter\"><div class=\"wp-block-embed__wrapper\">\n<blockquote class=\"twitter-tweet\" data-width=\"500\" data-dnt=\"true\"><p lang=\"en\" dir=\"ltr\">Anything you do to harm the dishonest miners who attacked you also harms the honest miners who were trying to protect you. It seems nearly impossible to shed enough of the former without shedding too many of the latter. I&#39;m not convinced an algo change will help.<\/p>&mdash; David &quot;JoelKatz&quot; Schwartz (@JoelKatz) <a href=\"https:\/\/twitter.com\/JoelKatz\/status\/1037127694419288064?ref_src=twsrc%5Etfw\" target=\"_blank\" rel=\"noopener noreferrer nofollow\">September 4, 2018<\/a><\/blockquote><script async src=\"https:\/\/platform.twitter.com\/widgets.js\" charset=\"utf-8\"><\/script>\n<\/div><\/figure>\n\n\n\n<p class=\"has-medium-font-size\">This means exchanges as well as merchants bear the brunt. And it can be cascading in that double spent coins can be used to hire more hash power from sites as Nice Hash. After that, the same can be used to attack blockchains. It\u2019s easier, <a href=\"https:\/\/www.crypto51.app\/\" target=\"_blank\" rel=\"noopener noreferrer nofollow\">Crypto51<\/a> rates indicate that Bitcoin Private transactions can be double spent at just $17 per hour.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Early this year, Ethereum Classic was attacked in what CoinBase said was a \u201cdeep chain reorganization\u201d &#8211; a euphemism for a 51 percent or a double spending attack. <\/p>\n","protected":false},"author":2,"featured_media":179,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[3],"tags":[29,28],"class_list":["post-175","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-learn","tag-29","tag-double-spend"],"acf":[],"_links":{"self":[{"href":"https:\/\/www.hodlin.com\/blog\/wp-json\/wp\/v2\/posts\/175","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.hodlin.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.hodlin.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.hodlin.com\/blog\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.hodlin.com\/blog\/wp-json\/wp\/v2\/comments?post=175"}],"version-history":[{"count":4,"href":"https:\/\/www.hodlin.com\/blog\/wp-json\/wp\/v2\/posts\/175\/revisions"}],"predecessor-version":[{"id":190,"href":"https:\/\/www.hodlin.com\/blog\/wp-json\/wp\/v2\/posts\/175\/revisions\/190"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.hodlin.com\/blog\/wp-json\/wp\/v2\/media\/179"}],"wp:attachment":[{"href":"https:\/\/www.hodlin.com\/blog\/wp-json\/wp\/v2\/media?parent=175"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.hodlin.com\/blog\/wp-json\/wp\/v2\/categories?post=175"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.hodlin.com\/blog\/wp-json\/wp\/v2\/tags?post=175"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}