- Qubic uses Monero mining via uPoW to earn XMR and reinforce its own AI-secured blockchain.
- Mined Monero is converted into Tether, then used to buy and burn QUBIC tokens in a loop.
- Qubic’s mining power surged to 40% of Monero’s network before settling near 27% by late July.
The Monero blockchain is under pressure following an aggressive mining push by Qubic, a project led by IOTA co-founder Sergey Ivancheglo. By leveraging its unique “useful proof-of-work” (uPoW) model, Qubic has been incentivising CPU-based Monero mining to strengthen its own ecosystem.
This mechanism converts mined Monero (XMR) into Tether (USDT), which is then used to repurchase and burn QUBIC tokens, creating a deflationary loop.
Between May and July 2025, Qubic’s share of Monero’s total hashrate soared to as high as 40%, stabilising around 27% by late July, prompting accusations of parasitism and alarm within the Monero community. Miningpoolstats placed Qubic as Monero’s leading pool temporarily, though backlash soon pushed it down to seventh.
Ivancheglo has announced a plan to acquire 51% of Monero’s hashrate during August, framing it as a technological demonstration rather than an attack.
In his own words, the goal is to highlight Qubic’s capabilities through an “economic demo”, though he acknowledged that block rejection and transaction delays could result. After 2 August, Qubic will cease reporting its hashrate, making monitoring efforts significantly harder.
Related: Tether Eyes US Institutional Launch Following GENIUS Act Approval
Monero’s Security Model Under Fire
Unstoppable Wallet analyst Dan Dadybayo explained that this move could allow Qubic to censor transactions, orphan blocks, and influence protocol behaviour. He noted that Monero’s security budget stands at around US$130,000 (AU$199,459) per day, yet majority control could be obtained for as little as US$7,000–$10,000 (AU$10,741–$15,344) daily.
The Monero community is debating responses ranging from pool migrations to protocol upgrades. Some users have accused Qubic of hashrate spoofing or bot use, although no evidence has confirmed this. Analysts warn this episode reflects broader vulnerabilities across proof-of-work systems, where financial incentives may outweigh decentralised ideals.
Related: Whale Accumulation and Tom Lee’s Valuation Model Reinforce Institutional Bullishness on Ethereum
Credit: Source link
