Kraken Suspends Monero Deposits Amid Qubic Hashrate Control

Kraken has halted Monero deposits after the Qubic mining pool seized more than 51% of Monero’s hashrate, raising security concerns over network integrity.

This incident highlights the vulnerabilities in proof-of-work coin networks, potentially impacting market perceptions of Monero’s security and decentralization capabilities.

Qubic’s 51% Hashrate Power Triggers Kraken’s Response

Kraken has announced a suspension of Monero (XMR) deposits following a security threat posed by the Qubic mining pool. This mining pool gained a majority of Monero’s hashrate.

The Qubic mining pool managed to reorganize six Monero blocks, raising centralization concerns. It’s unclear if aggressive mining will persist or if Qubic’s actions will have lasting effects.

Kraken Halts Deposits to Ensure Network Security

Kraken’s decision to halt deposits aims to maintain network integrity while allowing trading and withdrawals to continue. This measure underscores the critical threat that centralized mining control poses to security.

“As a security precaution, we have paused Monero (XMR) deposits after detecting that a single mining pool has gained more than 50% of the network’s total hashing power. This concentration of mining power poses a potential risk to network integrity. We are actively monitoring the situation and will resume deposits once we determine it is safe to do so. Trading and withdrawals for XMR remain fully operational.” — David Ripley, CEO, Kraken

The event has not yet influenced cryptocurrency regulation or policy changes. Monero’s price stability remains unaffected, but underlying trust in privacy-focused PoW coins might wane if centralization persists.

51% Attacks: A Recurring Threat to PoW Networks

Historically, 51% attacks have disrupted smaller PoW networks, such as Ethereum Classic. Monero previously experienced a flooding attack but avoided this scale of consensus tampering.

Experts warn that such events could lead to reduced exchange support or community-driven forks. Historical trends show sustained attacks might prompt developers to reassess consensus mechanisms.

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