A Second Attack on Krypton

Multiple digital publications announced that Krypton, an Ethereum based blockchain, recently recovered from a 51% attack.

According to Stephanie Kent, Founder of Krypton:

“KR is my vision for an ultra-fast blockchain that can realize all of the features of Ethereum with fewer initial coins, faster speed and lower inflation.

Krypton does all the same d-tech, namely DAOs, DACs, and DAPPs. The practical-use cases for this technology are set to explode, especially in the Internet of Things field. Companies will be actively seeking experienced developers.”

This exploit on Krypton included a two-pronged attack. The first overpowered the network with at least 51% of the hashing power to roll back the transactions in order to spend the same coins twice. The second prong was DDoS-ing nodes to multiply network power.

This attack launched speculations that it was a test for an attack on ETC. Author, Rocky at Crypto Hustle stated:

“This attack may be a “dry run” intended as proof of concept before targeting other Ethereum based blockchains. Shift, another Ethereum type coin, was also targeted by a similar 51% attack last week. 

Ethereum based blockchains are being targeted predominantly because they’re easy to fork and manipulate offline, while being used in conjunction with DDoS attacks.

It is suspected that the attackers may be using these lower cap coins as a testnet before targeting Ethereum Classic. This attack may be more difficult to scale up because of ETC’s larger aggregated hashing power.”

While this may be speculation, it was just noted that the attack was attempted again, yesterday (August 30, 2016). However, Krypton successfully defended against the attack.

Kent goes on:

“Krypton has taken the following steps towards preventing future attacks: 1) We have upgraded our client platform to v 1.3.3, eliminating a caching bug that allowed orphaned transactions that remained in memory to appear as valid. 2) Increased the maturity on the Bittrex exchange KR wallet to 3,000 confirmations (a maturity ETH originally used when they first launched on exchanges.) 3) Better distributing existing mining operations among the various Krypton pools and renting additional hashing power when alerted to potential attacks. 4) Reaching out to journalists and reporters to tell the story of this novel type of 51% attack in order to more-quickly grow the Krypton network to 30TH/s+, a size we believe can adequately defend itself going forward.”

Even if speculation that this attack is a warm-up for an attack on ETC proves true, the fate of ETC will certainly be subject to more changes within the next week. Since the attack on the DAO split funds, a large chunk of those ETC funds have been frozen.  The child DAO, created by the White Hat Group (WHG), is now available to specific DAO token holders. They will be issued a refund through a smart contract and will be able to sell their ETC for ETH, or any other asset, for the first time since the fork.

The attacker who originally drained the DAO will also have access to their funds on the ETC chain by September 2nd. This attacker has access to a child DAO that roughly holds about 5 percent of all ETC that’s in circulation. What the attacker plans to do with their funds next will greatly affect the ETC community.

Stay tuned for more updates.