The past two weeks have been an exciting and trying time for the ZenCash team. However, even in the face of adversity, the ZenCash team continues to thrive and deliver on our promises to you, the community.
Approximately two weeks ago, our exchange partner was the victim of a double spend attack, where a malicious actor was able to spend their ZEN twice. Double spends are possible in all proof-of-work chains due to consensus rules inherited from Bitcoin.
This attack targeted the exchange, not the ZenCash blockchain. The ZenCash blockchain is still secure, your funds are safe, and your private keys are still secret.
We just want to kill this, we don’t want this ever be a problem again for the industry. – Rob Viglione, Co-founder of ZenCash
This attack ignited the ZenCash team to create a comprehensive protocol level defensive strategy for our project and for the entire industry. The ZenCash development team has proposed an enhancement to the Satoshi Consensus in order to prevent 51% attacks.
The longest chain rule, or Satoshi Consensus, worked well in the relatively decentralized environment in which it was introduced in 2009. Mining resources have since concentrated and dropped in cost for lease, such that the original dominant strategy of playing by the rules no longer holds for all proof-of-work (PoW) blockchains that rely on the longest chain rule. As recent events have proven, in some circumstances it can be economically feasible to launch 51% attacks on operational public blockchain networks. This paper proposes a novel adjustment to Satoshi Consensus that makes it exponentially more costly, and hence unlikely, to launch such attacks for any proof-of-work mineable cryptocurrency system.
We can no longer solely rely on it being economically infeasible to launch an attack. We must push for engineering solutions to make it impossible, and we are tackling this issue head-on.
Watch Rob Viglione discuss the efforts to combat this industry-wide issue during the June 13, 2018 Biweekly Community update:
We encourage you to read and provide feedback on our latest white paper