Cryptocurrencies are not without their shortcomings. For example, Bitcoin had an issue that briefly paused its blockchain. Stellar Lumens (XLM) is the latest blockchain to encounter a bug, as a major industry data provider disclosed that millions of dollars worth of XLM were secretly introduced into the Stellar ecosystem in early 2017.
In April 2017, a hacker conjured up 2.25 billion XLM out of nowhere.
In an effort to provide top-notch data to the crypto world, the New York-based Messari released findings showing that 2.25 billion XLM were created from nothing in April 2017. Prior to this report, the debacle was largely unknown. revealed The attack, as revealed by research, involved the genesis of the cryptocurrency by an anonymous hacker using the 'MereOPFrame::doApply' function within Stellar’s protocol, which at the time contained a flaw. Although the specifics of the bug's exploitation are scarce, the financial impact of this unexpected attack is well-documented.
Messari’s analysis states that the illicit XLM tokens amassed a value of $10 million back then, representing over a quarter of the entire circulating supply of XLM at that time. Interestingly, Stellar's developers couldn’t pinpoint the attacker’s wallets swiftly enough, as the illegal XLM creation was likely funneled into exchange wallets and sold throughout the first half of 2017.
Following a remark from the Stellar Development Foundation (SDF), steps have been taken to prevent any future incidents. The SDF decided to burn Lumens from their development reserve to realign the supply, specifically to safeguard XLM holders from experiencing dilution. Representatives from the organization mentioned that 'Stellar has evolved into a major piece of financial software,' necessitating the SDF to enhance its transparency protocols, which are set to be implemented by the end of 2019.
Stellar may have recently caught attention due to these revelations, but it's by no means the first bug to impact the budding cryptocurrency sector.
Not The First Inflation Bug
Diverting from both the Bitcoin and ZClassic chains, there were 102 suspicious blocks which contained 400 anticipated outputs each. As Coinmetrics reported, these outputs collectively enclosed 2,040,000 BTCP, fabricated from nothing, and then tunneled to shielded addresses. The identity of this cunning attack’s perpetrator remains unknown, but estimates suggest they absconded with $1 million to $3 million. inflation Back in August 2010, a block famously overshot in its expectations. On August 15, 2010, block number 74638 gave rise to 184 billion BTC — a sum that catastrophically shattered Bitcoin's long-standing 21 million supply cap. Through a mysterious transaction involving negative value, billions of BTC were birthed via an integer overflow glitch. Fortunately, Gavin Andresen and the enigmatic Satoshi Nakamoto acted quickly to nullify the block.
During the mid-2018 creation of Bitcoin Private, Even though none of the unfathomable 184 billion BTC were ever traded, given to another entity, or claimed by any participant in the exploit, cryptocurrencies — including even the most prominent like Bitcoin — are not without vulnerabilities.
Even Bitcoin (yes, the Bitcoin Despite these challenges, the Stellar Development Foundation seems undeterred by its inflation-related history. Perhaps with good reason. Since the upswing in April 2017, the venture has ascended to crypto prominence as a top-tier digital currency.
The reasons for Stellar’s enduring success — whether it's due to strategic alliances with industry giants like IBM, deriving value from its smart contract capabilities, or layers of other unfolding developments — remain a matter for debate at Blockonomi. Nonetheless, the Stellar Development Foundation vows to propel the blockchain’s triumphant trajectory with their latest disclosure.
Stellar continues to stride forward, now teaming up with Coinbase.
Recently, the SDF declared its collaboration with Coinbase’s Earn offering, aiming to distribute $50 in XLM to countless recipients eager to learn about the potential of the protocol.
As someone deeply invested in the cryptocurrency realm since 2013, my analyses and dialogues have graced the pages of esteemed outlets like LongHash, NewsBTC, and Decrypt. When not engrossed in penning my thoughts, I contribute to the EXODUS division of HTC, a Taiwanese tech corporation. I admit to holding a modest stash of Bitcoin. Feel free to reach out at [email protected].
With Ripple (XRP) and Stellar (XLM) enjoying a surge, one has to wonder if they can keep pace with Rexas Finance (RXS) by 2025. Coinbase The Dojima Network is forging a path to lay the groundwork for a genuinely interoperable Web3 experience.
