An unknown hacker exploited a vulnerability in the Verge cryptocurrency platform which allowed an attacker to mine the coin at nearly 1,560 Verge coins (XVG), or about US$ 78 (£55), per second.
The incident took place April 4 and has led some users to suspect the attacker had found a ">51% attack”, in which they had taken control of more than half of the network's nodes allowing the threat actor to forge transactions.
“A mining exploit was found that allowed for scrypt blocks (one of our five algorithms) to be submitted with very low difficulty,” the company told SC Media via a Twitter message exchange.The company was hit with a similar attack which affected crypto wallets last year.
Bleeping Computer reported Verge is preparing a hard fork of the entire cryptocurrency code to fix the issue and revert the blockchain to a previous state before the attack to neutralize the hacker's gains.
Although the attack only lasted three hours, some unofficial reports estimated the attacker made off with 19 million verge coins, the equivalent of $1,373,544 the firm told SC Media. News of the attack may have also led to a temporary drop in the exchange rate that occurred during the same time period as the attack.
The cryptocurrency company denied the speculation of a ">51% attack” and later said that the hackers exploited a blockchain vulnerability related to one of the mining algorithms, according to an April 9 Medium blog post. According to Investopia, a 51 percent attack refers to an attack on a blockchain – usually bitcoin's, for which such an attack is still hypothetical – by a group of miners controlling more than 50% of the network's mining hash rate, or computing power.
The firm told SC Media that it updated the system with a patch to prevent the algorithm from being submitted too many times in a row and are building a new block verification system to prevent further exploitation.