Home / Crypto Currency / One Seemingly Useless Smart Contract Causes Major Ethereum Blockchain Bloat

One Seemingly Useless Smart Contract Causes Major Ethereum Blockchain Bloat

Even though the Ethereum network is receiving some scaling upgrades, network issues still tend to pop up now and then. Over the past few weeks, the network has seen a rather hefty influx of transactions which seemingly don’t serve any purpose. A recent discovery by a Reddit user shows someone may be purposefully clogging up the Ethereum network.

The Ethereum Network Congestion

While Ethereum’s blockchain is very powerful and boasts numerous technical advantages, it is also held back in some ways. When it comes to processing large amounts of transactions, Ethereum doesn’t fare much better than Bitcoin or other public blockchains. Despite a higher transaction throughput, this blockchain tends to get clogged up on a somewhat regular basis.

These issues have been well-documented in the past. Both the CryptoKitties network as well as some of the bigger initial coin offerings of Ethereum-based tokens have caused the blockchain to slow down and transactions to become stuck. Most users have addressed this by paying higher gas prices, although that is not a viable long-term solution whatsoever.

It now seems a new attack against the Ethereum network is brewing. Rather than trying to hack an ICO project or steal Ether, one particular contract is creating large amounts of blockchain bloat. This information was outlined on Reddit, and it seems the contract in question serves no purpose and should not even be in use. For some reason, the token associated with this contract is generating a lot of transactions, which is heavily inflating the average gas price on the Ethereum network.

Most of the accounts related to this token’s transaction activity appear to be controlled by the same entity. It is difficult to say if that is the case for certain, but it seems these accounts are all actively spamming the Ethereum network. Since the tokens are not being used anywhere nor actively being traded, it seems safe to assume the initial contract’s creator is responsible for all of this activity.

The bigger question is what anyone would gain by spamming the Ethereum blockchain with useless token transactions. Raising the average gas price doesn’t benefit anyone other than Ethereum miners. It seems highly unlikely any of the miners or mining pools is involved in this scheme, although nothing is impossible at this point. It is a very worrisome development for Ethereum, as attacks like these can cripple the network if they are left unchecked for an extended period of time.

With Ethereum’s upcoming scaling solutions, incidents like these will ultimately become irrelevant. Exactly when sharding and Plasma will come to the network remains a bit unclear. One can only hope this alleged attack stops sooner rather than later, although it seems highly unlikely that will happen anytime soon.

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Is Demand For Bitcoin Mining in Decline? Chip Maker Slashes Target

Taiwan Semiconductor Manufacturing Co. (TSMC), the world’s largest dedicated independent chipmaker, has predicted a drop in demand from the cryptocurrency mining community in the fourth quarter this year. The growth target of 7 to 9 percent was slashed to 6.5 percent partly due to the demand dynamics of bitcoin miners. Crypto Mining Demand For TSMC Chips to Weaken Further In Q4 2018, Says CEO C. C. Wei, Chief Executive Officer and Vice Chairman of TSMC told investors at the company’s third quarter 2018 earnings conference that business growth would be offset by “continued weakness in cryptocurrency mining demand”. “Moving into fourth quarter, despite the current market uncertainties, our business will benefit from the continuous steep ramp of7-nanometer for several high-end smartphones as well as the demand for 16/12-nanometer for the launches of new-generation GPU andAI. However, this growth will be partially offset by continued weakness in cryptocurrency mining demand and inventory management byour customers.” The company forecasts growth between 5 and 7 percent for the overall semiconductor market excluding memory, while foundry is expected to grow between 6% and 7%. Weakening demand from cryptocurrency miners has forced the firm to adjust the growth estimate to 6.5 percent in U.S. dollar terms, according to the chief executive. “However, our business is also negatively impacted by further weakening of cryptocurrency mining demand. As a result, we estimate our 2018 growth rate will be about 6.5% in U.S. dollar term, which is close to the foundry industry’s growth but slightly below our 7% to 9% guidance given in the last conference.” The downshift in mining profits is the main responsible for the company’s revision of its full-year sales target, citing uncertainty in the cryptocurrency market as its reason. In April, the Taiwan Semiconductor Manufacturing Company lowered its 2018 revenue guidance to 10% growth from 10-15%, estimating that about 10% of the Asian chipmaker’s revenue depends on cryptocurrency mining demand. Moreover, the entrance of Samsung in the global cryptocurrency mining sector could be providing TSMC their first real competitor in the sector, which in turn, may eventually push the company to lower its sales targets in years to come. Samsung has started the production phase of bitcoin and cryptocurrency mining equipment and ASIC mining chips earlier this year. The company intended to manufacture GPU miners for miners targeting small cryptocurrencies in the upcoming months. President Trump’s trade tariffs, on the other hand, may hurt future trade volumes of Chinese companies producing cryptocurrency mining hardware. This may eventually benefit TSMC as competitors from the People’s Republic of China will have a hard time in the race for the U.S. market. The post Is Demand For Bitcoin Mining in Decline? Chip Maker Slashes Target appeared first on NewsBTC.

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