Late Friday and Saturday, a series of events unfolded as a 13-block chain reorganization on the Litecoin network reversed roughly 32 minutes of activity. This was in response to a denial-of-service attack that took advantage of a vulnerability in the Mimblewimble Extension Block (MWEB) protocol. The attack allowed invalid MWEB transactions to bypass nodes that had not been updated, before the network's longest valid chain corrected them. Following the incident, Litecoin Core v0.21.5.4 was released, advising all users to upgrade due to important security updates.
According to the Litecoin Foundation, the bug was fully patched and the network resumed normal operation by Sunday morning. However, security researchers pointed out discrepancies in the timeline of events, suggesting the vulnerability was known and patched privately a month before the attack, but not publicly disclosed or mandated for all mining pools.
This created a window of opportunity for attackers, who seemed to be aware of which miners were running patched code and which were not. The attack involved a pre-funded wallet and a swap of LTC for ETH on a decentralized exchange. Experts argue the denial-of-service attack and the MWEB bug were separate components, designed to take patched mining nodes offline and allow unpatched ones to form a chain that included invalid transactions.
The network's automatic handling of the 13-block reorganization once the DoS stopped suggests sufficient hashrate was running updated code to eventually overpower the attack. This incident highlights the differences in how various networks respond to exploits, with newer chains capable of coordinating upgrades quickly and older proof-of-work networks like Litecoin facing challenges due to independent mining pools choosing when to upgrade.