On January 5, 2019, Ethereum Classic (ETC) fell victim to a 51% attack. At first, the attack went unnoticed for over 24 hours until Coinbase’s engineers noticed that 88,500 ETC (roughly $450,000) were falsely deposited on the OkEX crypto exchange.
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: https://t.co/vCx89dz44m
— Coinbase (@coinbase) January 7, 2019
As this news finally came to light, crypto enthusiasts everywhere took to Twitter and shared their opinions.
Litecoin creator Charlie Lee stated that Ethereum Classic is not dominant in its respective consensus mechanism (Ethash for Ethereum Classic), which led to the attack. To prove his point, he said that for NiceHash, which is a mining marketplace, to attack ETC for 1 hour would cost only $5,000.
Be careful w/ coins that are not dominant in their respective mining algorithm, especially ones that are NiceHash-able. ETC has less than 5% of the total Ethash hashrate and is 98% NiceHash-able. 1-hr attack costs $5k. Almost $500k has been double spent. https://t.co/REwM2lFA9Z https://t.co/bqw54LUjke
— Charlie Lee [LTC⚡] (@SatoshiLite) January 7, 2019
Lee’s statement on this matter was simply referring to the fact that it’s unsurprising that ETC was 51% attacked. Inferring that proof-of-work (PoW) chains that have dominant consensus mechanisms, like Bitcoin and Litecoin, are far less susceptible to this kind of attack.
Ripple CTO Bashes PoW and Praises XRP Ledger
In contrast to Lee’s statement on ETC’s 51% attack, David Schwartz, the chief technology officer at Ripple, stated that the vulnerablility lay in the PoW mechanism, and that XRP Ledger is not susceptible to double-spend attacks like PoW chains would be.
For those who don’t know, XRP’s consensus mechanism is completely different from that of PoW, as validators and tracking servers maintain the ledger without mining.
Another PoW blockchain suffers a double spend attack, this time ETC. XRP Ledger's distributed agreement protocol eliminates this risk.https://t.co/RQBEWAXmRD
— David Schwartz (@JoelKatz) January 7, 2019
Schwartz’s brief statement fueled the “XRP Army,” which subsequently came out in full force with hundreds of tweets proclaiming that the 51% attack on ETC was a win for XRP. XRP fans proclaimed that XRP’s distributed agreement protocol was far superior to that of PoW’s consensus mechanism, and so on and so forth.
However, while XRP has a strong following and fan base, there are also a significant number of people who view XRP as a centralized digital asset controlled by the fintech firm that is Ripple. These Ripple skeptics were also quick to defend PoW just as XRP fans were quick to attack it.
XRP Fans and Ripple Skeptics Battle It Out
The popular YouTuber, Crypto Bobby shared his thoughts on the crypto community discussion that XRP is better than coins that utilize PoW. His recent video on the matter covered a variety of comments from XRP fans and Ripple skeptics alike.
One comment which Crypto Bobby highlighted came from Paone, a growth advisor at Mike Novogratz-backed Airswap, where he said:
“If you’re an XRP fan, you can certainly say ‘hey Coinbase, you listed Ethereum Classic that got 51% attacked, so it has proven [itself] to be not secure.’ But, on the other end [of the spectrum], maybe [the Ripple ledger] is very vulnerable to government, regulators, and things of that nature, due to the potential centralized nature of it.”
Paone’s comment above was not alone in its opinion of Ripple. The pro-crypto social media platform, Gab.com, criticized Ripple for being able to freeze user funds, whenever and for whatever reason they want.
Pro tip: if Ripple Labs can freeze your funds at anytime for any reason you might have a scamcoin on your hands that isn't decentralized.
Might as well just open a normal bank account lol.
— Gab.com (@getongab) January 7, 2019
Many Twitter users commented on the tweet, with one of them stating that XRP can in fact be 51% attacked when a few board members agree on something. This comment accentuates the centralized nature of Ripple, which many crypto fundamentalists see as going against the entire of blockchain.
However, Ripple’s CEO Brad Garlinghouse is adamant that statements like these are fundamentally false. On December 18, he held an Ask Me Anything (AMA) with Ripple’s Senior Vice President of Marketing, Monica Long. In addition to calling 2018 a “hero year” for Ripple, Garlinghouse went on to defend Ripple as being more decentralized than Bitcoin:
“By ALMOST ANY measure NOW, the XRP Ledger is more decentralized than The Bitcoin ledger.”
Garlinghouse points out that Ripple runs 7 validators, whereas in the case of Bitcoin or Ethereum, the majority of mining power rests in the hands of just a few miners.
All in all, there are strong points to be made for each side. This battle between XRP fans and Ripple skeptics was won by no one and certainly won’t be the last we see.
Are you a fan of Ripple and XRP? Do you think XRP’s distributed agreement protocol is superior to PoW? Let us know what you think in the comment section below.