::Very Important::If you are not aware by now, Sexcoin has been the recipient of block-withholding attacks, both last year and two weeks ago. The dev team has been in discussion about the state of Sexcoin and crypto in general. We are aware that exchanges are particularly vulnerable to these attacks because of the nature of how they work. Although this should be obvious, we would like to go ahead and state it plainly. Sexcoin, (any scrypt based coin, with a few exceptions.. i.e. litecoin ), is currently insecure under its present metrics... and no coin that is insecure can really be taken seriously by people wanting to either invest or use it. Crypto's single largest selling point is the security of the block-chain.
Current holdings are not at risk. What is at risk are coins that are sent or recieved
during an attack.
Since July, Sexcoin has had an average of 25 - 30 GH/s on its network. It has peaked at around 45 GH/s and been as low as 15 GH/s. Over that same timespan, Litecoin has had an average of about 300 TH/s on its network, peaking at 385 TH/s and going as low as 210 TH/s.
This brings to light what Sexcoin is really up against by using the scrypt algorithm at this time. Here are some points to keep in mind:
- At any given time there is AT LEAST 385 TH/s available globally to mine scrypt.
- Sexcoin, during 'normal' operation ( not under attack ) has attracted as high as 45 GH/s, this is 0.00015% of the total global hashrate available.
- In order to overwhelm the network, a bad actor only has to use 0.00030% of the total global hashrate. Approximately 80 GH/s.
- On MRR, there is 22.15 TH/s of scrypt power available for rent.
- As I write this, 3 hours of hashpower at 80 GH/s can be bought for 0.0080 BTC or $52
IF we were to attract 3 times the peak amount of honest hashpower, that would be 45 x 3 or 135 GH/s, the bad actor would need to purchase 135 X 2 ( the argument could be made that it could be pulled off with only 135+1 ), which can be purchased for 0.0180 BTC or $117... Doubling that to create a sustained attack for 6 hours would cost $234. That is not a lot of money, and well within reach of most people.
Again, right now, renting 45 GH/s for 24 hours would cost 0.0297 BTC ( $193 ), A quick rent for 12 Hours comes in at 0.01 BTC ( $65 ) The differences are because of how the rigs are selected and what's available for how long.. but we are looking at around $150 - $200 per day to provide a baseline of 45 GH/s to keep the network secured. Even with this effort, we would have been overwhelmed by an attack at the $230 level for 6 hours.
Sexcoin, as a project, is at a crossroads. We feel a responsibility both to the supporters of Sexcoin and the crypto community at large. Sexcoin was built on being available for miners and has enjoyed the fact that it was a coin that could still be mined in your basement. That time is over. We have had a number of discussions about different ways to keep the block-chain secure. POS, checkpoint servers, switching algorithms and coin swaps to token based have all been on the table since last year. Our real hope was that Sexcoin would realize its place in the eco-system and attract enough miners so that we could continue its course. These last attacks have convinced us that it has not.
Again, considering the global availability of hashrate, we cannot run sexcoin as pure scrypt under its present metrics any longer.
Therefore, in consideration of the current holders, miners and supporters of sexcoin,
we are going to institute merge-mining. The intent here is to
decisively secure the block-chain going forward, in a way that is both fair to current holders and people that are newly attracted to Sexcoin.
I have been in contact with both Livecoin and Cryptopia. They have both expressed a willingness to continue listing Sexcoin, under certain conditions. We believe merge-mining will satisfy those conditions, and we fully support the efforts they have made to protect both themselves and their clients. The perpetrators of these attacks are thieves, and their attacks are by design. Last year there was still some question as to whether or not the forks were malicious, this time there is no doubt.
Merge-mining is a process where we can leverage the hashpower that is being dedicated to litecoin. A miner can mine both litecoin and sexcoin using the same mining gear at the same time. This is done in a way that the full amount of hashpower is used on both networks at the same time. So merge-mining sexcoin is a bonus, and not merge-mining sexcoin would be leaving money on the table. This creates a very strong incentive to mine sexcoin and help secure the network. It does this while still preserving the ability to mine sexcoin on its own.
We will be publishing a time-line with more information soon™.
EDIT:
Here is the followup and timeline
