Bittrex, a crypto exchange regulator will delist Bitcoin gold (BTG) in the near future due to an $18 million hack of BTG earlier in the year.
The cryptocurrency has been attacked by double spending hacking attack that left the company as a victim of unknown hijackers who dominated a lion’s share in the control of the Bitcoin Gold hash rate.
The attack, reportedly to have started in May 2018 left financial lame on the cryptocurrency. The attack is said to have amassed an amount, more than or close to $18 million in the Bitcoin Company in the course of exchange with other companies, Bittrex inclusive.
How the Attacker Masqueraded
An explanation from the Bitcoin Gold team held that the hacker employed a technique that deployed a 51% double spend attack that targeted exchange transactions.
The activity could automatically ‘accept large deposits’ and at the same time allow the users to carry out an exchange of coin into a different one in a flash. One could also be allowed to do a fast withdrawal after the exchange.
For instance, the hacker is said to have made large Bitcoin deposits on exchanges while concurrently sending the same amount to his or her own crypto wallet. Before it was realized, the transaction was deemed void.
During these fishy activities, the ‘beneficiary’ had already swallowed the entire funds from the crypto bait, hence doubling his initial funds.
Who is to Blame in the Attack?
Although a finger of blame on hackers cannot be pointed to a particular source of error, in most cases, the security policyholders and enhancers are the ones to blame if things get overly slippery.
In this case, the Bitcoin Gold claimed that their team was not to blame as they are not responsible for tightening the security policy in private entities like the Bittrex.
Moreover, the exchanges were supposed to manage their own security. Bitcoin Gold developers recognized the menaces taken by their own blockchain.
On the other hand, Bittrex shifted the blame on BTG’s proof-of-work consensus as a factor that led to the menace.
Additionally, the hack was not the first one to have passed via the BTG lane. In late 2017, it is said that a fake Bitcoin Gold wallet made away with private keys that were worth $3.3 million in the crypto.
Impacts of BTG’S Removal
The removal of BTG from the Bittrex platform is in itself a huge blow to the company and its credibility. Its market capitalization shall continue to be on the nose-diving trend.
BTG will continue to fall from grace after refusing to pay the hack compensations to Bittrex. This is according to cryptovest.com. The US-based trading platform demanded compensation whereby the BTG declined the claim and deemed itself as a non-profit making organization.
This will have a possible wreck of the relationship between the two in the wake of increased cryptocurrency rising market.
Bottom Line
Security is a thorny issue as far as online transactions are concerned. The security incidences, especially in the field of cryptocurrency, have become an issue of concern.
Both sides are putting blames on this monster for the loss. Bitcoin Gold team has said that the security aspect was to be sorted out by the private Bittrex while the Bittrex blamed the proof-of-work from the Bitcoin side.
Overall, of importance is to learn a lesson that every business must manage risks of security timely and tightly.
Sources
https://cointelegraph.com/news/bittrex-to-delist-bitcoin-gold-by-mid-september-following-18-million-hack-of-btg-in-may
