Sergey Ivancheglo promotes Qubic with massive Monero mining, sparking debate over decentralization risks

Sergey Ivancheglo, co-founder of the IOTA protocol also known by his alias CFB, has launched an ambitious strategy through Qubic that is generating significant tensions in the Monero ecosystem. His project leverages the “useful proof of work” (uPoW) mechanism to massively incentivize CPU mining, an approach that promises to redirect computational power towards productive tasks simultaneously.

However, this initiative has escalated controversially. Since mid-2024, the participation in the computational power of the Monero network linked to Qubic has gone from representing less than 2% to reaching 27% in just a few months. This exponential growth has raised alarms throughout the Monero community about two critical concerns: the risk of network centralization and vulnerability to potential coordinated attacks.

Ivancheglo’s uPoW mechanism and its impact on Monero

Sergey Ivancheglo’s strategy is based on linking Monero mining with useful computational objectives within the Qubic ecosystem. While the project presents this as an innovative “economic demonstration” of blockchain technology, the resulting concentration of computational power questions the fundamental premise of decentralization that underpins Monero. A 27% stake in a single project generates potential for undue influence in the network’s decision-making.

Community concerns about security and the 51% risk

The Monero community has expressed particular concern about the proximity to a 51% attack scenario, where control of more than half of the computational power would allow manipulation of transactions and the integrity of the ledger. Although Ivancheglo has explicitly denied malicious intentions, he acknowledged that his operation could effectively disrupt the normal functioning of the Monero network, a confession that has intensified community skepticism.

The shift towards opacity: announcement of strategic silence

In a move that some interpret as a response to community pressure, Qubic announced that starting August 2, 2024, it will cease public disclosure of its participation in Monero’s computational power. Ivancheglo justified this measure by arguing that it aims to “raise awareness about the 51% control risk,” although critics question whether it represents a strategy to operate with greater discretion while maintaining the influence acquired over the network.

The episode underscores the inherent tension between ambitious technological innovation and decentralized governance, positioning Sergey Ivancheglo at the center of a broader debate on the ethical limits of experimentation with critical blockchain networks.