Hackers Return $ 260 Million To Cryptocurrency Platform After Massive Theft
- Estimate of $ 600 million stolen from token exchange platform
- Analysts cite difficulties in laundering stolen coins
- Hacker Says “Always Plan” to Return Tokens
LONDON / SINGAPORE / HONG KONG, Aug.11 (Reuters) – Hackers behind one of the biggest cryptocurrency heists of all time have returned more than a third of the $ 613 million in coins digital files they stole, the company at the center of the hack said on Wednesday.
Poly Network, a decentralized financial platform that facilitates peer-to-peer transactions, said on Twitter that $ 260 million of the stolen funds had been returned but $ 353 million was unpaid.
The company, which allows users to exchange tokens between different blockchains, said on Tuesday it had been hacked and urged those responsible to return the stolen funds, threatening legal action.
Hackers exploited a vulnerability in digital contracts used by Poly Network to move assets between different blockchains, according to blockchain analytics firm Chainalysis.
One person claiming to carry out the hack said he did it “for fun” and wanted to “expose the vulnerability” before others could exploit it, according to digital messages shared by Elliptic, the crypto tracking company and Chainalysis.
It was “still planned” to return the tokens, wrote the alleged hacker, adding: “I’m not very interested in the money.”
Hackers or hackers were not identified and Reuters could not verify the authenticity of the messages.
Tom Robinson, co-founder of Elliptic, said the decision to return the money could have been motivated by the headaches associated with laundering stolen crypto on such a scale.
An executive at cryptocurrency firm Tether said on Twitter that the company has frozen $ 33 million related to the hack, and executives from other crypto exchanges have told Poly Network that they will also try to help.
“Even though you can steal crypto-assets, it is extremely difficult to launder and withdraw them, due to the transparency of blockchain and the wide use of blockchain analytics by financial institutions,” said said Robinson.
Poly Network did not respond to requests for more details. It was not immediately clear where the platform is based, or if a law enforcement agency was investigating the heist.
The scale of the theft was comparable to the $ 530 million in digital coins stolen from the Tokyo-based Coincheck exchange in 2018. Mt. The Gox exchange, also based in Tokyo, collapsed in 2014 after losing half a billion dollars in bitcoin.
The Poly Network attack comes as losses from decentralized finance (DeFi) theft, hacks and fraud hit an all-time high, according to crypto intelligence firm CipherTrace. Read more
At $ 600 million, however, the Poly Network theft far exceeded the $ 474 million in criminal losses CipherTrace reported recorded by the entire DeFi industry from January through July. Thefts have illustrated the risks of the largely unregulated industry and may attract the attention of regulators.
DeFi platforms allow parties to transact, usually in cryptocurrency, directly without traditional gatekeepers such as banks or stock exchanges. The industry has exploded in the past year, with platforms now handling over $ 80 billion in digital coins.
Supporters of DeFi say it provides individuals and businesses with free access to financial services, saying the technology will cut costs and boost economic activity. But technical flaws and weaknesses in their computer code can make them vulnerable to hackers.
Reporting by Alun John in Hong Kong, Tom Wilson in London and Tom Westbrook in Singapore Editing by Michelle Price and Cynthia Osterman
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