Verge reveals Pornhub deal. Prices plummet, network hacked again

Andrew Munro

Posted: 18 April 2018 12:22 pm News

The disastrously entertaining Verge fiasco just got much more entertaining and disastrous.

Long story short: Verge and Pornhub are currently rolling out a joint advertising deal that Verge supporters paid for out of their own pockets before finding out what the deal was, resulting in Verge prices plummeting while its blockchain simultaneously gets hacked again with a loophole that's ostensibly been fixed several times.

It all began when Verge developers asked their supporters to contribute over a million US dollars' worth of Verge coins to inspire the anonymous partnership to take off. Verge promised the mysterious partner would be a huge global household name at the top of its industry.

Verge users immediately started guessing the mystery partner's identity. Amazon was one popular guess, as was Apple, PayPal and several banks. Now it turns out to be Pornhub. Credit where it's due, they weren't lying about the mystery partner being at the head of its industry.

• Did you know? "Verge" is French for "penis."

It wasn't immediately clear why any actual partnership would be contingent on donations from a coin's user base, but now it makes a lot more sense. It did demonstrate a kind of willingness to use and spend the coin, and it highlighted the useful gullibility of the community. More importantly, it may have also served as a straight up payment from Verge to Pornhub to cover costs for this particular PR stunt.

Behold the future of financial services.

The stunt

It's safe to say the Verge community, or "Vergins" as they like to be called, would have been hesitant to pay for a porn site advertising spree out of their own pockets, so ambiguity may have been necessary.

The beef of the supposed "partnership" is simply that Pornhub now accepts Verge payments. It did this by installing the third-party CoinPayments plugin, which some are saying doesn't even work.

Pornhub bravely took a stab at explaining that they chose Verge because the coin is focused on private transactions through its "Wraith protocol" feature. Unfortunately it's never worked, and all Verge transactions are transparently put on the blockchain.

This transparency is useful because it lets anyone explore the Verge blockchain and see that it's currently being hacked.

Verge is still getting hacked.

Verge prices have plummeted a solid 25% since the partnership broke, according to CoinMarketCap. Fortunately for enthusiasts, the poorly-programmed blockchain might currently be under attack, which could be blocking many people's transactions and preventing them from selling their Verge coins.

Here's a picture of the a fragment of the Verge blockchain, taken a few minutes ago at the time of writing.

Here's an explainer of what you're looking at.

Block 2067985 and block 2067986 were mined back to back, and the latter block is showing a timestamp earlier than the preceding block. This is reminiscent of the spoofed timestamps, and blocks only seconds apart that have characterised the Verge hacks which have been going on for weeks.

Both of these blocks are empty except for the mining reward fee, which is going to these two addresses respectively. As you can see, they were both created very recently and their only input is a huge amount of block rewards which are quickly passed on to a central address.

Track the outflow of money from one of them and it arrives at this wallet. It was fairly active in October and November of 2017, and sparsely active from February. Then on precisely 6 April, which is exactly when the latest spate of Verge attacks commenced, it started receiving a fairly incredible constant flow of XVG tokens which has slowed, but not stopped, since the Verge bugs were supposedly fixed.

This looks like one of many addresses being used by an attacker, and it's clearly still receiving a constant flow of Verge tokens which can be traced to exploited blocks. Odds are you'd find a similar looking trail leading of of most suspicious blocks.

It's a good thing Verge transactions aren't private, otherwise this would all be much harder to track.

The great thing about this particular exploit is that it drastically increases the amount of Verge in circulation. So far it's pumped countless millions of extra Verge coins into existence, which for some reason hasn't stopped prices from rising.

Verge developers are obviously lacking on the technical side of things, but at least they have a firm grasp of pornography marketing. The Verge community, meanwhile, is mostly rejoicing in the great news and puzzled that the price is dropping.

Disclosure: At the time of writing, the author holds ETH, IOTA, ICX, VEN, XLM, BTC and XRB.

Picture: Shutterstock