What is Automatic Checkpointing and why is it important to Guncoin?

What is Automatic Checkpointing and why is it important to Guncoin?

HTMLCOIN had 14 billion coins stolen from exchanges using 51% + Replay attacks and had to re-launch a new coin with premine to cover the loss which totaled $2.2m. 51% attacks are becoming more common with small coins and are being used to target exchanges, some of these attacks have been combined with replay attacks, this is when an attacker deposits and withdraw the same coins to and from an exchange, they then replace the chain with a 51% attack removing the deposit transaction, then they apply the withdrawal transaction to the replaced chain withdrawing coins from the exchanges hot wallet that were never deposited on the attackers chain. This has proved disastrous for other coins and steps need to be taken to protect against these sort of attacks. A simple and effective solution is to use automatic checkpointing which was first developed and deployed by Peercoin. Checkpoints are part of the Bitcoin codebase and are statically defined in the source code. Peercoin created a system where these checkpoints were sent across the P2P network. A client that receives a checkpoint will not connect to any chain without it. This protects the history of the chain and prevent 51% block replacement attacks. The depth of these checkpoints from the top of the chain will be set to six to allow natural reorgs at the very top of the chain. Any service using Guncoin can set their confirmation count to six after automatic checkpointing has been enabled and be safe in the knowledge that no transactions will be reversed.