Litecoin’s active addresses triple by possible Dust attack

• Litecoin’s network has experienced a significant rise in the number of active addresses at certain times.
• The activity has alerted network users of a possible Dust attack.

The development of Litecoin‘s network update, MimbleWimble is progressing as expected. When launched the network will be more private and will have more fungibility. However, for now, Litecoin remains vulnerable to certain security flaws, such as Dust attacks.

The dust or dusting attack involves sending a fraction of a cryptocurrency (dust) to multiple addresses. When the recipient obtains these micropayment, the attacker can monitor the recipient’s address changes and violate the victim’s privacy. In this way, the attacker can steal various information from the victim in order to carry out extortion, fraud or other illegal activities.

Conspicuous changes in the number of active addresses on Litecoin

A recently published Litecoin blog post examines a conspicuous pattern that could indicate a Dust attack. According to the publication, the pattern began on August 20, 2019. A few days earlier, Litecoin’s network suffered an attack. The following graph shows how the pattern leads to an increase in the number of active network addresses. The number of active addresses is usually 40,000, but since August 20 the number has doubled every 7 days.

Source: Litecoin Active Addresses historical chart – BitInfoCharts

As can be seen, the network reaches a peak at almost equal intervals. The number of ascents varies. At the last peak on 16 December today, the network reached a number of 136,000 active addresses. Several causes are suspected for the emergence of this phenomenon. Most likely, however, is a Dust attack. One of the indicators leading to this assumption is the discrepancy between the number of active addresses and the non-increasing transaction volume:

(…) what is clear though is that total number of transactions aren’t spiking and average value being sent is also uncorrelated.

Source: Litecoin Transactions vs. Avg. Transaction Value historical chart – BitInfoChart

Measures against Dust attacks

Litecoin’s publication does not conclude that the pattern is necessarily caused by a Dust attack. It only concludes that if an attack of this nature is confirmed, users must take action. Even in that field the publication can only make some recommendations. First, the miners have to change the rules and incentives of the network. Second, users have to simply ignore the received “dust”, although the nature of the attack makes it difficult for the user to tell if he has received “dust”.

As already mentioned, Litecoin is currently working on MimbleWimble (MW). Among other things, this should make the network less vulnerable to these attacks. However, Mimble Wimble is still in the development phase, although it is not free of criticism , as CNF reported. Ivan Bogatyy, a Dragonfly Capital employee, said he discovered a bug in the MimbleWimble protocol that allowed him to track 96% of the network’s transactions. Charlie Lee defended the protocol by saying that MimbleWimble has limitations on which they are working.

In addition, members of the crypto community have expressed concerns about the implementation of MW. If Litecoin becomes a privacy coin it can potentially be removed from the list of crypto exchanges that are adapting to strict regulations.

The price of Litecoin, at the time of publishing the article, is $ 43.33 USD and has had losses of 1.09% in the last 24 hours.

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