Bear market demands new victim: Coinhive closes the gates

The continuing bear market for cryptocurrencies has already driven many companies to ruin in recent months. Now it has caught the next provider: The well-known crypto-mining service Coinhive closes in early March forever its doors. Reason: The service was not economically viable. A tragic loss or rather a reason to breathe again? The Coinhive team announced the decision on February 26 on the official company blog. Accordingly, the mining service will be discontinued on March 8, 2019. Registered users will still be able to use the dashboard until April 30, claiming unpaid payouts.

Coinhive closes its doors: Mining software is not worth it anymore after Monero crashes

The main reason for the closure is the massive crash of Monero hash rate by more than 50 percent after the last Hard Fork. Added to this is the general slowdown in the crypto market: The market value of XMR fell in the course of last year by almost 85 percent. For March 9, another hard fork and an update of the algorithm are planned. All of this would have led to a conclusion: Coinhive just is not worth it anymore. The attitude was therefore the only logical step. Coinhive has been making headlines over the past few months, but not always with good news. The service provides a JavaScript-based code that can be incorporated into web pages to mine Monero in the background – without the knowledge or consent of the visitors. Coinhive was therefore repeatedly referred to as malware and was especially widespread for the so-called cryptojacking.

Malware experts warn against cryptojacking with Coinhive

It was not until January 2019 that the Israeli security firm Check Point released its latest malware threat index. Coinhive’s mining script was at the top again for the thirteenth consecutive year. According to Kaspersky Lab’s security specialists, cryptojacking, the unauthorized use of mine computing resources, has become one of the biggest network security threats. In the Middle East, Turkey and Africa in particular, the number of mining attacks nearly quadrupled during the year, rising to about 13 million incidents in 2018. The experts warn that such incidents will increase in the future.

Is the end of the mining service a loss?

The question remains: is the end of Coinhive now a real loss for the industry? This is probably a matter of opinion, but originally the service was started with good intentions. The Promise: Instead of using ads and affiliate programs, website owners should monetize the pages through Monero’s mining revenue. Actually a good idea – which did not really work in practice. Apart from some laudable exceptions, Coinhive was mainly used on dubious file-sharing portals and porn sites. Not the best advertisement and the numerous hacker attacks in connection with Coinhive did not provide much confidence. But what weighs even more seriously: a membership for the majority of users has not really paid off. A study by the Aachen University of Technology showed that Coinhive’s revenues were distributed extremely unequally. Although the mining generated more than $ 250,000 a month, most of the money went to just ten people.