Was Syscoin [SYS] hacked? Team clarifies the recent confusion related to its trading activity 17780
Altcoin
Pinaz Kazi
Jul 6, 2018 at 11:15 AM

On July 3, 2018, Syscoin tweeted mentioning that atypical blockchain activity was noted from their side and they request the exchanges to halt all $SYS deposit or withdrawal for that day.

This caused a lot of confusion in the community with speculations about the hack. Reports mentioned that one billion Syscoin was mined from a single block, despite the total supply being around 888 million. In a recent post on Medium, Syscoin team said that they take its security very seriously and that’s why the temporary cease on deposit/withdrawal from exchanges was announced.

See also: Binance suspends trading, withdrawals and other account functions

The team in the post mentioned that Syscoin was not hacked, compromised or attacked, as it was reported. In fact, the truth is “something else entirely”. They released Syscoin 3.0.6 around 10 days ago. The post mentioned, “The release was a mandatory update fixing a governance superblock fee calculation bug. Once a superblock with transaction fees was hit, it would not validate clients that hadn’t moved onto the mandatory update.”

On July 3, a massive rise in the price and trading volume of Syscoin was noted. Before the price movements on Binance, their team detected large buy walls across exchanges and noticed some irregularities. They saw that the blocks that are being processed were not including transactions regularly. Furthermore, masternodes were expiring with the mining difficulty dropping due to large miners not mining with their ASICs.

See also: The Exponential Growth of Syscoin (SYS) Smells Fishy: SYS Price Analysis

A Superblock was created at around 1:00 PM PST, and they stated that it was “expected and prepared for weeks in advance”, causing some miner nodes to halt. Post this, several large mining pools set fee policies that were more than the coin’s default rate. So, the transactions where the criteria were not satisfied, they became “backed up” in the mempool of the chain. Continuous mining by the miners with lower fee rates with transactions being processed in batches, making it appear “larger than normal amounts of Syscoin to be transacted in a single block”.

Image via Shutterstock

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