Another Day, Another Crypto Attack, Costing Users More than $5 Million

There has been a recent influx in crypto wallets being wiped out. This at a time, when crypto currency is going through growing pains, both from a technology resiliency and asset class point of view.

The Solana network is viewed as one of the most promising newcomers in the crypto market. Solana’s sol token is one of the largest cryptocurrencies after bitcoin and ether and it touts backers like Chamath Palihapitiya and Andreessen Horowitz. It is also considered a strong challenger to Ethereum with faster transaction processing times and enhanced security. 

Not any more...

Starting Tuesday evening, multiple users began reporting that assets held in “hot” wallets — that is, internet-connected addresses, including Phantom, Slope and Trust Wallet — had been emptied of funds. The Twitter account Solana Status confirmed the attack, noting that as of Wednesday morning, approximately 7,767 wallets have been affected by the exploit. “Engineers from multiple ecosystems, with the help of several security firms, are investigating drained wallets on solana,” according to Solana Status, a Twitter account that shares updates for the entire solana network.

Elliptic’s estimate is slightly higher at 7,936 wallets.  Blockchain audit firm OtterSec tweeted that the hack has affected multiple wallets “across a wide variety of platforms.”

The identity of the attacker is still unknown, as is the root cause of the exploit. Accroding to Tom Robinson, chief scientist at Elliptic, “it appears to be due to a flaw in certain wallet software, rather than in the solana blockchain itself.”

The incident comes one day after the $200 million hack of the Nomad blockchain bridge. It’s the latest crisis to grip the crypto market in recent weeks.

“Four addresses are currently linked to the hacker, a far cry from yesterday’s ‘decentralized looting,’ which involved over 120 individual users,” said crypto investor and analyst Miles Deutscher. “This implies that it was a singular party who conducted the SOL exploit, although the specific details remain ambiguous.”

The identity of the attacker is still unknown, as is the root cause of the exploit. The breach is ongoing.