There have been several security incidents involving Ethereum Classic last week. Not one but two 51% attacks were executed against the network. Due to these issues, exchanges and other trading platforms have to take adequate measures.
Coinbase Takes it Seriously
Given the number of exchanges providing trading support for ETC, there will be some serious consequences due to these two successful network attacks. A delay in deposits and withdrawals is the likely outcome. Raising the number of confirmations is crucial to ensure no double-spend attack can take place. As such attacks took place in the past two weeks, it is pertinent to protect from danger.
Coinbase, one of the biggest exchanges in the world. is taking ample precautions. Not only are they raising deposit and withdrawal times, but in quite spectacular fashion too. It will now take 2 weeks for ETC deposits to confirm on Coinbase and Coinbase Pro. Whether this applies to withdrawals as well, has not been confirmed.
Given the recent network attacks on Ethereum Classic, we have increased the confirmation time for ETC sent to Coinbase & Coinbase Pro to ~2 weeks. We are actively monitoring the situation and will provide updates as they become available.
— Coinbase Support (@CoinbaseSupport) August 8, 2020
For the time being, ETC deposits require 80,640 confirmations. This is not an arbitrary number either. A double-spend attack can occur days after an initial transaction is broadcasted. The two-week window is generally considered “safe”. This decision will undoubtedly upset some Coinbase users, however.
It doesn’t happen often that an exchange imposes such lengthy delays. Looking over the Coinbase page, most coins require far fewer confirmations. One interesting exception is Bitcoin SV. Users moving that altcoin to the exchange need to wait for 1,008 network confirmations. A major difference compared to Bitcoin’s 3 confirmations.
Ethereum Classic Price Keeps Tanking
These two successful network attacks have not been beneficial to the Ethereum Classic price. A net 7.5% decline has been recorded in the past week. Additionally, the overall sentiment toward this altcoin is turning rather negative. Not entirely surprising, as a 51% attack is nothing to be happy about.
Turning this ship around will pose a challenge for Ethereum Classic. The asset is still a part of the Grayscale Trusts, but one has to wonder if that will remain the case. One positive aspect is how ETC still generates a decent trading volume. Without it, this currency would be well outside the crypto top 30 by now.