Bitcoin SV Endures 51% Attack

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In Brief
  • Cryptocurrency Bitcoin SV is under a 51% attack, initially identified yesterday, Coin Metrics reported on Twitter.

  • The Bitcoin Association, which supports Bitcoin SV, has been active on Twitter instructing node operators how to respond.

  • One expert sees the attack as a ploy to get BSV removed from exchanges.

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Cryptocurrency Bitcoin SV (BSV) is under a 51% attack, initially identified on August 3, Coin Metrics reported on Twitter. 

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The Bitcoin Association, which supports Bitcoin SV, has been active on Twitter instructing node operators how to respond. For instance, node operators should mark fraudulent chains as “invalid” to lock out attackers.

Coin Metrics’ report was affirmed by companies such as Goldman Sachs Group Inc. Subsequently, Fidelity Investments explained that “no further reorganization events have been witnessed, but there are still synchronization conflicts taking place on major mining pools.” BSV had endured previous attacks in June and July. 

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A “51% attack” is an attempt by miners to gain control of more than half a blockchain network’s computing power. Possession could enable intruders to prevent new transactions from gaining confirmations. This would give them the power to stop transactions between some or all users, or even double-spend tokens.

Bitcoin SV’s tribulations

According to CoinGecko.com, Bitcoin SV is currently the 46th-biggest cryptocurrency, with a market value of about $2.5 billion. BSV is a spinoff based on the original “Satoshi Vision” of the original cryptocurrency. It was created as a hard fork off of Bitcoin Cash in November 2018, itself spinning off from Bitcoin in 2017.

Given the differing visions of each of the projects, their schisms have left lingering enmity between them. Given this, blockchain infrastructure provider Blockdaemon CEO and Founder Konstantin Richter see the attack as a ploy to get BSV removed from exchanges. Earlier this year, BSV was delisted by Australia’s largest digital asset exchange Independent Reserve.

BSV was down about 4% amidst the apparent attack to $135, according to CoinGecko pricing. This is more than 70% off from its mid-April highs.

“In the immediate term, the attack has seemingly had a somewhat-negligible impact on its current price action,” said Adam James, senior editor at cryptocurrency exchange OKEx Insights. “Faith in the proverbial third-place Bitcoin will likely be reduced further following the incident, which may negatively affect its long-term price prospects.”

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Nick is a data scientist who teaches economics and communication in Budapest, Hungary, where he received a BA in Political Science and Economics and an MSc in Business Analytics from CEU. He has been writing about cryptocurrency and blockchain technology since 2018, and is intrigued by its potential economic and political usage. He can best be described as an optimistic center-left skeptic.

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