Hackers Steal $600m In Major Cryptocurrency Hack

More than $600 million has been reported stolen in what looks like one of the biggest cryptocurrency thefts ever. Hackers have been alleged to have breached blockchain-based platform Poly Network. Poly Network is a decentralized finance (Defi) firm working on the interoperability of crypto coins, in other words, a platform that looks to connect different blockchains so that they can work together. These hackers have exploited the Poly Networks vulnerability and extracted more than $600 million in cryptocurrencies.

The company took to Twitter to make this announcement, seeking to establish communication with the hackers, and urging them to “return the hacked assets.” In the letter, the company added “Law enforcement in any country will regard this as a major economic crime and you will be pursued.  This is marked as the biggest hack ever in the decentralized finance space that’s heating up investors’ digital currency.

According to reports, once the hackers stole the money, they began to send it to various other cryptocurrency addresses. Researchers at security company SlowMist say a total of about $600 million worth of cryptocurrency was transferred to three different addresses.  PolyNetwork revealed that $267m of Ether, $252m of Binance coins, and roughly $85 million in USDC were taken out. The combined value of the stolen tokens making it even bigger than the $460 million hacks on cryptocurrency exchange about seven years ago with Mt. Gox that led to the company’s bankruptcy and heightened regulation in the nascent space.

Since blockchain is a public ledger, the company was quick to identify the virtual addresses where these currencies were deposited and alerted cryptocurrency networks to block further deposits from the addresses. The security company, Slow Mist, in a tweet claimed that the digital currencies had been transferred to three different addresses and the company had “grasped the attacker’s mailbox, IP, and device fingerprints” and were “tracking possible identity clues”

Meanwhile, Changpeng Zhao, CEO of major cryptocurrency exchange Binance, acknowledges his firm was aware of the attack, he added there was only so much he could do. However Binance is “coordinating with all our security partners to proactively help,” but that “there are no guarantees.” “There are no guarantees,” he added. About $33 million of Ether that was part of the theft has been frozen, according to the stablecoin’s issuer.

A blockchain is a ledger of activities upon which various cryptocurrencies are based. Each digital coin has its own blockchain and they’re different from each other. Poly Network claims to be able to make these various blockchains work with each other. Cryptocurrency systems such as Ether and Binance were developed independently, so have struggled to work in conjunction with each other. Losses from fraud in the Defi sector hit an all-time high of $474m in the first seven months of the year, says a report from research company CipherTrace. But losses from crime in the overall cryptocurrency market dropped sharply to $681m, compared to $1.9bn for the whole of 2020 and $4.5bn in 2019. Last week, the US Securities and Exchange Commission (SEC) charged Defi lender Blockchain Credit Partners and two of its top executives for raising $30m through allegedly fraudulent offerings. The case is the SEC’s first involving securities in the Defi space.