Crypto exchange giant Coinbase has suspended all interactions with Ethereum Classic after announcing that it had detected double spends totaling more than one million dollars. In a Medium post titled "Deep Chain Reorganization Detected on Ethereum Classic (ETC)," authored by Security Engineer at Coinbase, Mark Nesbitt, the San Francisco-based exchange wrote that after it detected a "deep chain reorganization of the Ethereum Classic blockchain that included a double spend" and "in order to protect customer funds," it "immediately paused interactions with the ETC blockchain."
Subsequent to this event, Coinbase said it detected 12 additional reorganizations that included double spends, totaling 219,500 ETC (~$1.1M). "Late on the evening of Saturday 1/5, our systems alerted us to a deep reorg in ETC that contained a double spend. Our on-call engineers responded to the alert and worked to confirm the report through the night. We determined that we would temporarily halt send/receive interaction with the ETC blockchain in order to safeguard customer funds," Coinbase wrote. "We performed an analysis on Sunday afternoon/evening to confirm the pattern and determine the key details of the double-spend attacks. Beginning Sunday afternoon, we observed eight more incidents, all containing double spends. Out of an abundance of caution, we did not put up a blog post prior to legal and technical review. A false alarm could have inadvertently caused market instability. On Monday 1/7 morning after legal and technical review, we finalized our public analysis and posted to our blog and social media accounts."
The Ethereum Classic Twitter feed posted a message on Sunday stating that: "To be clear we are making no attempt to hide or downplay recent events. Facts are facts and as the situation develops we'll soon get a full picture of what actually took place. Linzhi is testing ASICS. Coinbase reported double spends; both may be true. In time we will see."
On Monday, it shared a Medium post titled "Why I Am Still Optimistic About Ethereum Classic (ETC)."
"In my opinion, I believe that happened is a significant setback, but I think ETC still has a unique positioning as a PoW + Turing-complete network with an active community with sound principles."— Ethereum Classic (@eth_classic) January 8, 2019
Why I am Still Optimistic About Ethereum Classic $ETChttps://t.co/VTo9vfY5C5