An unforeseen blockage in the Ethereum network has actually triggered a lot of hue and cry among its users as well as node operators. Following the congestion, ETH prices started sinking and touched a low of $405.29. It ends up that Fcoin, a cryptocurrency exchange, could be the culprit behind Ethereum’s dilemma.
Supposedly, Fcoin carried out a new ballot system which supposedly ‘incentivizes a Sybil strike’. A Sybil attack is an act of producing large numbers of phony identities to obtain a disproportionately enormous impact on a network. MyCrypto called the ballot mechanism to be ‘mind-numbingly despicable’ in a current Tweet.
Mycrypto has actually been estimated, as stating,” Unsurprisingly, people who are economically incentivized to get a shit-token noted on a shit-exchange are sending these symbols en masse to separate accounts on the blockchain and after that to different accounts on the ‘exchange-who-must-not-be-named’ […] and also thus resulting partially (or completely?) in the network congestion & high transaction charges that we have actually experienced these past few days.”
Fcoin took on a new ballot system fairly unlike the standard ones normally made use of by various other crypto exchanges. The voting system allows users to choose symbols to be listed on the platform using down payments. Therefore, one deposit equals one ballot. As a result, numerous tokens made deposits for gaining ballots resulting in clogging of the network.
A Chinese crypto market collector reportedly found the trading volume on Fcoin to usually be above $5 billion over a span of 24-HOUR. The trading volume is attributed to a trans charge mining profits model. The platform pays back trading fees paid in BTC or ETH with its FT symbols, until 51 percent is distributed to the public, making traders the proprietor of the exchange, FCoin owner Jian Zhang stated in a meeting with Fred Wang, owner of Mars Money.
Zhang insisted that Fcoin’s profits model is simply a ‘misinterpreted innovation’. According to records, the exchanges which embraced the trans fee mining design saw their trading volumes top Binance. Another cryptocurrency exchange – Coinex – saw its trading quantity soar by over 24000% in a 24 Hr period after welcoming the brand-new model.
A mechanical engineer turned journalist, Shekar takes a keen interest in the study and analysis of cryptocurrencies and blockchain strategy. With the cryptocurrency world blooming in the recent days, he finds great interest in monitoring their growth and gathering every possible piece of information about them. He works as a crypto-journalist for the website Ripplechatroom.