Crypto Mining Service Coinhive to Shut down over Market Downturn, XMR Updates

Coinhive, an in-browser cryptocurrency mining service that helped fueled a cryptojacking trend, has recently announced it’s shutting down over various updates to Monero (XMR), the cryptocurrency it allowed users to mine, and crypto market’s slump.

According to a blog post, a hashrate drop on the privacy-centric cryptocurrency’s network, along with its price drop, were behind the decision.

The drop in hash rate (over 50%) after the last Monero hard fork hit us hard. So did the ‘crash’ of the currency market with the value of XMR depreciating over 85% within a year.

The company added that this, along with an announced hard fork and algorithm update for the cryptocurrency on March 9, led it to the decision. As such, it’ll effectively shut down on March 8, and users will be able to withdraw their funds from the platform until April 30.

Coinhive was launched back in September of 2017, and at the time promoted itself as an alternative to ads on websites, as it allows website operators to earn from users’ CPUs, by mining cryptocurrency with them.

Essentially, through a JavaScript file, website administrators were able to control how much of their visitors’ CPU resources they used to mine. The system was even experimented on The Pirate Bay, but never took off as an alternative to ads.

It was, in fact, criticized online was cybercriminals started using its JavaScript code to hijack websites and rake in the privacy-centric cryptocurrency, leading to a cryptojacking trend. It got so big that government websites, thousands of routers, and YouTube ads were used to mine crypto with users’ computers.

As a result, a McAfee report in late 2018 revealed the cryptocurrency mining malware trend had grown at least 4,000%. Soon, browsers like Opera and FireFox started blocking cryptocurrency mining scripts altogether.

Cryptojacking Success

Coinhive’s initial success saw a number of other firms open with the same goal: offer website operators code that would allow them to monetize their pages. While various competitors surface, as ZDNet points out security researcher Troy Mursch revealed in August of 2018 Coinhive had a market share of 62%.

Some estimates claim at its peak, Coinhive was making $250,000 a month. As XMR’s price started dropping, so did interest in using its code, which saw profits dwindle. ZDNet reports fewer cryptojacking campaigns have been taking place, and only one of its competitors has been gaining traction.