The Ethereum Classic blockchain was the victim of a 51% attack (often called a majority or Sybil attack) on January 5, 2019 that reorganized portions of the blockchain and allowed the attackers to double-spend 219,500 ETC ($1.1 million). As a result of this attack, and similar majority attacks over the past year, the concept of immutability within blockchain technology has been revealed to be a potentially costly oversimplification. If determined foes can
alter a blockchain, even temporarily, then many blockchain systems may be more fragile than is commonly perceived. These attacks show that protecting the permanence of data on the blockchain cannot be assumed, but instead is an evolving challenge and an important consideration for those who design, manage, participate in and rely upon blockchain networks for their businesses.
This update presents a more nuanced understanding of blockchain immutability, along with providing a practical understanding of mining algorithms, market trends and how they relate to the efficacy of blockchains serving as immutable repositories of transaction data. The update concludes by summarizing some of the ways that market participants are using legal solutions to mitigate risks and respond to attacks.