A private mining guild (mining pool) that mines a cryptocurrency ‘HDAC’ is surrounded with hacking and dine and dash controversies. It is surrounded with these controversies because it announced that all its balance was released without permission as one of its employees’ PC was hacked while it was not paying cryptocurrencies to its participants. It is expected that there will be more harm in the future as it still does not have any clear-cut regulations or safety devices.
‘HDAC Mining Pool’, which mines HDAC, posted an announcement on its site saying that it is being restored as one of its mining servers was hacked on the morning of the 24th. Withdrawal of cryptocurrency from its mining pool will be limited until HDAC Mining Pool finds the cause of the problem.
Mining pool is a group (pool) of many people with mining resources to improve efficiency in mining of cryptocurrencies. They mine cryptocurrencies together through their computing powers from graphic cards or miners and distribute cryptocurrencies between them. Miners can participate in a mining pool by either having their own mining equipment or by paying certain amount of money to a mining place.
HDAC Mining Pool is a mining pool that was established by a user called Ethereum V from a cryptocurrency community called ‘DDENGLE’. Within this community, HDAC Mining Pool is also called ‘Ethereum V Pool’ due to the leader’s ID name. HDAC Mining Pool once had about 200 miners as Ethereum V is the first one to suggest a mining pool related to HDAC.
HDAC Mining Pool does not have a direct relationship with Hyundai BS&C. This controversy was mistakenly known as ‘Hyundai BS&C’ hacking as it was heard that former President Jung Dae-seon of Hyundai BS&C was involved in HDAC Mining Pool through equity participation.
“HDAC Mining Pool has no relationship with Hyundai BS&C.” said a representative for Hyundai BS&C.
Mining and off-board transactions of HDAC are taking place very actively as many people from major cryptocurrency communities are showing high level of interests towards HDAC. Although it is not listed on any exchange in South Korea, it is heard that an off-board transaction is taking place at $0.92 (1,000 KRW) as signs of large-scale purchases are observed.
“Off-board transactions have started to become more active as level of difficulty of mining suddenly shot up starting from the 22nd.” said a HDAC miner. “Large-scale off-board transactions take place offline when people exchange cryptocurrencies after meeting in person.”
Besides Ethereum V Pool, about 5 to 6 HDAC mining pools are also currently in operation. When mining occurs, most of these pools automatically or manually distribute coins to participants of their pools. On the other hand, Ethereum V Pool has been gathering participants while delaying pays saying that withdrawal process is not working properly.
It is heard that amount of HDACs that are stored within Ethereum V Pool is worth about $1.1 million (1.2 billion KRW). Although Ethereum V Pool announced that all its balance was released without permission as one of its employees’ PC was hacked, participants of Ethereum V Pool is suspecting of ‘dine and dash’. They are worried that Ethereum V Pool is not going to distribute HDAC and disappear while using a hacking incidence as an excuse.
Although some Ethereum V Pool participants will prepare lawsuits, it will not be easy for them to help victims of this case as South Korean Government does not recognize cryptocurrencies as assets and it is difficult to calculate amount of coins that are obtained through mining. Because HDAC is also not listed on any exchange in South Korea, it is difficult to calculate actual amount of damage.
“Issues related to mining of cryptocurrencies are not within the jurisdiction of financial authorities.” said a representative for a financial authority. “Although policies were set by The Office for Government Policy Coordination in the past, there is nothing we can do as cryptocurrency regulations are divided into many departments.”
Staff Reporter Park, Jungeun | jepark@etnews.com & Staff Reporter Gil, Jaeshik | osolgil@etnews.com