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  • Bitcoin Gold experienced 51% attack that resulted in successful double-spending.
  • The coin has gained ground significantly, despite the attack news.

Bitcoin Gold (BTG), now the 35th digital asset with the market value of $200 million, has gained over 14% in the recent 24 hours to trade at $11.82 at the time of writing. The coin hit the recent high at $12.26 on Sunday and entered a range-bound phase after a short-lived retreat. BTG’s trading volume is registered at $76 million, nearly twice as large as on Friday, January 24.

51% attack on Bitcoin Gold network

Bitcoin Gold network fell victim to 51% attack for the second time. According to James Lovejoy, the president of MIT Bitcoin Club, two deep reorganizations took place on the network on January 23 and 24. Both resulted in double-spending. The attackers managed to transfer BTG coins worth of $70,000 to the Binance account and withdraw them successfully after 12 confirmations. The exchange increased the number of confirmations to 20 since that time. Lovejoy believes it took the hacker 14 or 15 reorganizations to bypass the Binance security system. As each reorganization const them about   0.2 BTC (~$1,700), it is possible that they got away with a profit.

Therefore, it is possible that the attacks were profitable if the double-spends succeeded at defrauding the attacker’s counterparty, or break-even if the double-spends were unsuccessful. This suggests that a confirmation requirement on the order of tens of blocks for BTG is still far too few to make the budget constraint to launch an attack significantly, the expert concluded.

Notably, BTG/USD experienced a strong growth following the news about 51% attached. The upside momentum was accompanied by growing trading volumes. The coin has gained over 30% of its value in just three days.

BTG/USD: technical picture

On the intraday charts, BTC/USD is trading in a tight range with the local support created by the middle line of 1-hour Bollinger Band at $11.22. Once it is cleared, the sell-off may be extended towards psychological $11.00 and $10.60 reinforced by SMA200 1-hour, closely followed by $10.50 (SMA50 1-hour).

On the upside, a sustainable move above $11.70 set the stage for a recovery towards $12.00 reinforced by the upper line of 1-hour Bollinger Band and proceed to the recent top of $12.26. Once it is out of the way, the highest level of 2020 $14.88 will come into focus.

BTG/USD 1-hour chart