Qubic, a platform led by IOTA co-founder Sergey Ivancheglo, recently announced plans to capture 51% of Monero’s hashrate between August 2 and August 31, drawing significant criticism from the cryptocurrency community.
The platform operates using a unique Proof-of-Work (uPoW) algorithm, converting mined Monero (XMR) into USDT to buy back and burn its QUBIC tokens, thereby creating a deflationary tokenomics model. In May, Qubic grew rapidly to become the largest mining pool on the Monero network, increasing its share of the hashrate from 2% to 27%. However, as of now, it has dropped to fourth place.
Sergey Ivancheglo described this initiative as an “economic experiment,” emphasizing that it has no malicious intent. The primary goal is to reveal vulnerabilities inherent within Proof-of-Work networks.
Analyst Dan Dadibayo examined the possible consequences of Qubic reaching 51% control, highlighting the dangers of centralization regardless of intent. Once dominant, the Qubic pool could potentially reject blocks and transactions from other miners, delay transaction confirmations, suppress competing pools, and even enforce protocol changes.
“Qubic says, ‘We don't want to hurt anyone.’ But intent doesn't matter. Centralization is a risk. Censorship potential is a threat. Economic incentives are a new attack vector,” Dadibayo warned.
According to the expert, upon reaching 51%, the Qubic pool will be able to:
- reject other people's blocks;
- reject transactions;
- delay confirmations;
- suppress competitors;
- impose protocol changes.
In response to Qubic’s planned dominance, the Monero community has rallied around the supportxmr.com pool, which currently holds about a third of the network’s hashrate to help balance power distribution.
Discussion among community members also includes speculation about the whereabouts of Qubic’s leader. Ivancheglo himself remarked humorously about the hostility, stating, “I hope the reward for my head will not be paid in XMR, so as not to create an incentive to bring its price down to zero.”
Following this announcement, Monero’s price dipped slightly by 1.1% over 24 hours, trading near $323 at the time of writing. Meanwhile, QUBIC’s price increased by approximately 9.5%, reflecting the controversy and attention surrounding the project.
The unfolding situation underscores growing concerns about miner centralization risks in blockchain networks and the balance between experiment and network security.
