It’s a fast-moving world out there in the world of cryptocurrency, where every day brings new projects forking off and existing ones running into new headwinds. Recently, concerns have arisen regarding the potential impact of Qubic, a novel blockchain project, on the security and privacy of Monero, a leading privacy-focused cryptocurrency. This article explores the technical details of Qubic's unique approach and examines the potential risks it poses to Monero's network integrity.

Understanding Qubic's Useful Proof of Work (uPoW)

At the same time, Qubic offers a unique consensus mechanism, Useful Proof of Work (uPoW). Current Proof of Work (PoW) systems consume enormous quantities of energy without providing tangible benefits to the world. In comparison, Qubic’s uPoW aims to make the computational energy expended in mining earn true value. Second, it uniquely blends the security of blockchain technology with cutting edge technology in Artificial Intelligence (AI).

Rather than just crunching random math equations, Qubic targets the processing power at training Artificial Neural Networks (ANNs). Miners in Qubic, usually known as AI trainers, are training ANNs with a random neural network architecture. This extraordinarily resource-intensive process is part of what makes it well-suited for a proof-of-work (PoW) system. Simultaneously, it plays an important role in the evolution of these neural networks. As such, the mining process stops being only a security mechanism and instead becomes an economic contributor to the research of AI.

The Qubic ecosystem runs on an epoch-based economy. Each epoch is one week long, with a total of 1 trillion QUBIC tokens created during that time. These tokens are primarily awarded to what Qubic terms as « Computors » depending on how they perform at training ANNs. This new economic model increases the incentive to participate and invest in the overall network.

The 51% Attack Threat to Monero

The crux of the issue rests in the possibility that Qubic could gain a large share of Monero’s hashrate. If Qubic were to control 51% or more of Monero's mining hash rate, it could theoretically launch a 51% attack. This sort of attack would let the controlling entity centralize all block creation, thus consolidating control over the Monero network.

Analyst Dan Dadybayo highlights that a 51% hashrate concentration creates a "new attack vector rooted in capital rather than code." Rather than attacking Monero’s codebase, a malicious actor could simply buy the network monopoly. This popular method reduces the attack’s complexity while making it more appealing.

  • Orphaning Rival Blocks: Qubic could reject blocks mined by other pools, effectively excluding them from the blockchain and preventing those miners from receiving rewards.
  • Delaying Confirmations: Qubic could delay confirmations of transactions, causing uncertainty and potential losses for users who rely on timely transaction processing.
  • Suppressing Competition: By controlling the majority of the hash rate, Qubic could suppress competition from other mining pools, potentially stifling innovation and leading to a more centralized mining landscape.
  • Forcing Protocol Changes: In a more extreme scenario, Qubic could potentially force changes to the Monero protocol, although this is a complex and less likely outcome.

It should be made clear that Qubic does not mean all of this maliciously. The intended outcome of the project is a more open, collaborative, sustainable ecosystem for useful and impactful blockchain technology. The use of its technology in a way that would ultimately undermine Monero’s security is truly a worst case potential. The farce exemplifies the fundamental dichotomy between innovation and security in the crypto world. New technologies indeed present a world of exciting possibilities, but they pose novel risks that need to be thoughtfully addressed and mitigated.

Balancing Innovation and Security

In both Bitcoin and Monero, the potential centralization of hashrate is a key danger, as it goes against Monero’s core ideas of decentralization right at their roots. A successful 51% attack could disrupt Monero's network, leading to orphaned blocks, delayed transactions, and a loss of trust in the network. Furthermore, such a move could threaten the integrity of the network, exposing it to nefarious malicious actors. Qubic’s “useful proof-of-work” (uPoW) system could fundamentally change the mining game for the better. If adopted widely, this would increase the overall security of privacy-preserving networks such as Monero, but this isn’t the reality given the current environment.

It is very important for the Monero community to stay ahead of and stay proactive in combating these possible dangers. This involves increasing transparency on hashrate distribution, developing potential countermeasures, and encouraging a healthy, varied, and decentralized mining ecosystem. The future of Monero’s security, privacy, and fungibility could very well rely on it.

It is crucial for the Monero community to remain vigilant and proactive in addressing these potential threats. This includes monitoring hashrate distribution, exploring potential countermeasures, and fostering a diverse and decentralized mining ecosystem. The future of Monero's security and privacy may depend on it.