Cryptocurrencies are very complex technical projects which require constant maintenance. Every now and then, a major issue is discovered which needs to be addressed. The Monero developers recently fixed a major vulnerability which could have led to massive theft. A positive development for the industry, partially thanks to community members highlighting the potential long-term consequences.
The Monero Bug Explained
Cryptocurrencies are respected because they remove the risk of a chargeback. All transactions on the network are final, barring a double-spend attack from happening. Despite this security-oriented approach, however, issues can arise at any given moment. At the Monero protocol level, a major issue was discovered by a community member. Albeit just a theoretical attack, the consequences cannot be ignored.
This particular incident is referred to as a “burning” exploit. It is capable of disrupting the way how exchanges handle incoming XMR deposits. Sending multiple transactions to a stealth address would be a very unfavorable outcome. A stealth address is temporary and offers additional privacy to Monero users.
Exchanges relying on a stealth address could be exploited through the following method. A person could send 1 XMR to an exchange and receive a payment in a different cryptocurrency for that amount, such as BTC. However, the person could theoretically make the same transaction thousands of times and then get thousands of bitcoins. However, the faulty Monero code would only validate the first transaction. The additional transfers will all be rejected. For the exchange, however, all broadcasted transactions would result in conversions to other currencies despite only receiving 1 transfer in the end.
Addressing Critical Issues Is Vital
Thankfully, it was relatively easy for the developers to address this problem. A new version of the Monero code has been made publicly available. Some exchanges have halted XMR deposits and withdrawals as they upgrade the code accordingly.
This news comes at an interesting time for all cryptocurrencies. Bitcoin developers recently addressed a very big flaw not that long ago. This goes to show cryptocurrency projects are still undergoing big changes as they continue to grow and evolve. Because of the open source nature of these projects, anyone can contribute solutions and ideas to make the cryptocurrency in question more secure.
With both Bitcoin and Monero putting these issues behind them, the cryptocurrency industry can continue to gain traction. It is also great to see this information being shared with the public in a timely manner. Cryptocurrencies are all about transparency, despite the anonymous approach of some projects. Keeping the community in the loop is vital, as this incident has shown once again.
Were you surprised by the potential scope of this major Monero flaw? Let us know in the comments below.
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