Qubic’s Controversial Monero Mining Strategy: A Game-Changer or a Threat?
Qubic, a project spearheaded by IOTA co-founder Sergey Ivancheglo, is stirring up controversy in the Monero cryptocurrency space with its innovative mining strategy. By employing a model known as "useful proof-of-work" (uPoW), Qubic aims to bolster its AI-secured blockchain while also enabling CPU-based mining for Monero (XMR).
This approach has some intriguing consequences: mined Monero is converted into Tether (USDT), which is subsequently used to repurchase and burn QUBIC tokens—creating what is effectively a deflationary loop within its ecosystem.
Mining Dominance in Monero
Between May and July 2025, Qubic’s share of the total Monero hashrate soared to remarkable heights—peaking at 40% before stabilising at approximately 27% by late July. This sudden surge has raised eyebrows, with accusations of parasitism surfacing within the Monero community. At one point, miningpoolstats ranked Qubic as the leading mining pool for Monero, but growing backlash soon saw it drop to seventh place.
Ivancheglo has a bold vision: he aims to secure 51% of Monero’s hashrate throughout August. He characterises this move as a technological showcase rather than an outright attack on Monero. However, he admitted that this strategy could lead to block rejections and transaction delays. Notably, after August 2, Qubic plans to stop disclosing its hashrate, complicating ongoing monitoring efforts significantly.
Monero’s Security Model Under Threat
Analyst Dan Dadybayo from Unstoppable Wallet has voiced concerns over the implications of Qubic’s control. He suggested that with such substantial hashrate dominance, Qubic could potentially censor transactions, orphan blocks, and even manipulate protocol behaviour to its advantage. He highlighted that Monero’s security budget stands at around US$130,000 (approximately AU$199,459) each day, but a majority stake could be acquired for a mere US$7,000–$10,000 (AU$10,741–$15,344) daily.
This harsh reality has prompted discussions within the Monero community about possible responses—ranging from migrating to different mining pools to implementing protocol upgrades. Some users have alleged that Qubic may be engaging in hashrate spoofing or deploying bots, although no solid evidence has emerged to support these claims. Analysts believe this situation underscores broader vulnerabilities in proof-of-work systems, where financial incentives can overshadow principles of decentralisation.
Conclusion
As Qubic navigates this contentious landscape, the future of Monero’s security model appears precarious. The debates within the community reflect deep-seated concerns over the balance of power and the sustainability of decentralised networks. The question remains: will Qubic’s bold tactics serve to strengthen its own ecosystem, or will they ultimately threaten the integrity of Monero itself? Only time will tell how these developments will unfold in the rapidly evolving cryptocurrency arena.
