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BitcoinCash users: our network under attack

06 August 2017 21:00, UTC

During this weekend, the Bitcoin Cash network was experiencing an attack by unknown hackers who used the malleability exploit. Forklog.com reports on this, citing the ViaBTC, a mining pool based in China, and describes additional details.

This malleability weakness is a cryptographical tricking with the digital transaction signature: the signature itself is changed, but its definition is not. In other words, anyone can take a desired P2P transaction, change the signature – but the system will still approve it. This will not even change the transaction result, but it will create accounting problems, as the unique identifier of transaction, or txid, will be changed. Another type of issues these unauthorized malicious identification changes might bring is that operations based on unapproved transactions relying on txid, such as Lightning Network, might become completely unavailable.

“We've temporarily suspended withdrawal and your assets are safe,” assured ViaBTC its clients, but the problem is going to reappear due to the structure of Bitcoin Cash network. The Segregated Witness protocol, or SegWit, pending implementation in the Bitcoin network, will remove this exploit there. Amusingly, the BitcoinCash supporters previously argued that SegWit is not as important as other improvements like the bigger size of blocks in the chain and stated that this malleability issue can be fixed by other means.

ViaBTC later resumed its operations, which tells that they managed to fix the problem for now, but Forklog.com notes that the Bitcoin Cash network still has other problems, like unknown malicious miners and even mysterious mining pools who are trying to regulate the price of the cryptocurrency in their favor.