ZCash Developer ECC Reacts To Coinbase’s Double Spend Warning

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In a flip of occasions that has sounded alarms within the crypto group, Coinbase warned that it has noticed a single mining pool, ViaBTC, controlling 53.8% of the Zcash community hash charge. The cryptocurrency change promptly took precautionary actions to mitigate the dangers related to a 51% assault, a state of affairs that arises when a single entity controls over half of the computational energy on a blockchain community.

Coinbase’s Mitigation Measures

Upon detecting this vital centralization within the Zcash community, Coinbase promptly elevated the Zcash affirmation requirement to 110 block confirmations, elongating deposit occasions from a mean 40 minutes to roughly 2.5 hours.

This transfer is a bid to counter the double-spending vulnerabilities that come up when one entity controls over half of a proof-of-work blockchain’s computational energy. Additional, to defend its buying and selling group from potential market upheavals that might ensue, Coinbase shifted its Zcash buying and selling to a “limit-only” mode, thereby quickly suspending market bids.

Coinbase’s assertion reads: “We shared our considerations across the dangers of mining centralization and supplied suggestions for numerous choices that both get together may implement to scale back the chance of a 51% assault.” The change has initiated discussions with ECC and ViaBTC to hunt a broader dispersion of mining energy.

ECC’s Counter Response

At this time, the Electrical Coin Firm (ECC), the event drive behind Zcash, publicly responded to Coinbase’s protecting measures. In a Twitter thread, ECC stated, “ECC is conscious of this concern, and we’ve had conversations with Coinbase, ViaBTC, Zcash’s safety lead, and Zcash Neighborhood Grants. IMPORTANT: Zcash is a decentralized, open-source community with no ‘lead developer,’ no ‘issuer,’ and no org that controls it.”

An intriguing revelation from ECC’s statements was the acknowledgment of the inherent “lack of finality” that plagues proof-of-work blockchains, a problem that Zcash will not be resistant to. In response, ECC is advocating for his or her “Trailing Finality Layer” (TFL) proposal, which is designed to supply finality for Zcash.

Shifting away from the standard proof-of-work consensus, ECC divulged its analysis endeavors to transition Zcash to a proof-of-stake mechanism. With Nathan Wilcox spearheading these efforts, ECC is exploring the feasibility and efficiency of the TFL hybrid-PoW-PoS strategy. This technique may doubtlessly introduce finality to the Zcash community, serving as an middleman resolution earlier than a full transition to proof of stake.

“Transferring Zcash to proof of stake is one in every of 4 key focus areas for ECC, and Nathan Wilcox is devoted full-time to PoS R&D,” the tweet acknowledged, including “if the group chooses to activate the TFL hybrid-PoW-PoS strategy, that may allow finality on the Zcash community earlier than an all-in-one shift to proof of stake. The following step in our PoS R&D is to construct a prototype of TFL to see the way it performs.”

The Implications And Path Ahead

Though ViaBTC’s management raises the specter of a 51% assault, consultants word {that a} mining pool is totally different from a single malicious miner. ViaBTC consists of quite a few particular person miners who may shortly disperse to different swimming pools if any malign actions had been detected.

Nonetheless, the state of affairs has reignited debates concerning the vulnerabilities tied to PoW blockchains and is driving ongoing conversations between main stakeholders about transitioning to PoS techniques.

Coinbase has affirmed its dedication to carefully monitor developments and alter its threat mitigations as wanted. In the meantime, ECC is forging forward with its TFL proposal and PoS transition plans.

At press time, Zcash traded at $26.00.