Thursday, August 11, 2022

HACKERS FIRST STOLE $600 MILLION WORTH OF CRYPTO AND THEN RETURN ON THE REQUEST OF THE EXCHANGE

In a cyber-attack on the token-swapping platform, Poly Network, hackers stole crypto worth more than $600 mn. The stolen virtual tokens include the famous Bitcoins, Ethereum, Tether. This stolen amount makes it the biggest heist in the history of the decentralized financial (DeFi) sector. The hackers had exploited a vulnerability in Poly Network systems to pull off this heist.

WHAT IS A POLY NETWORK?

According to their official website, Poly Network is implementing interoperability between multiple chains in order to build next-generation internet infrastructure. They also help authorized public blockchains to communicate with other blockchains. This way they help crypto-exchanges to complete transactions without investing heavily in personal server infrastructure. 

WHAT HAD HAPPENED?

On Tuesday, a relatively less popular Poly Network was attacked. The hacker exploited a bug and transferred more than $600 mn worth tokens in his/her wallet. Later, Poly Network took to Twitter to disclose the attack. They also asked the hacker to establish communication with the Poly Network team. And return the stolen assets.

Later on Wednesday in a U-turn, the hackers contacted the firm and said that they had done this to expose the vulnerability in the system before others could benefit from it. Further, they on the same day had returned $260 mn of the hacked assets. On the subsequent day, they have returned most of the assets and only $33 million worth of Tether remain outstanding. 

WHO WERE THE CRYPTO HACKERS?

The return of assets makes the hacker looks more like a white-hat hacker who aims to work ethically in exposing vulnerabilities in computer systems. But a large section of cyber-security experts looked skeptical for the same. They argued that the hacker due to the fear of authorities is returning the money. The motive of the hackers is uncertain until they return the entire amount.

A person claiming to be the hacker said that he was contacted by Poly Network and offered a bounty to return the assets. Further, he also claimed that they promised him no accountability for the incident. 

IMPACT ON THE DeFi SECTOR

Due to the decentralized nature of crypto, it is very difficult to track the identity of the person owning them. Identity can’t be ascertained until they have been brought through registered exchanges. This anonymous nature makes them an easy target for hackers. Also, the lack of traditional authorities like Banks, the unregulated market makes it riskier to store money in them. The year was not good for this sector. More than 50% of total frauds that occurred in the history of DeFi sector have been recorded this year. The future of this sector depends on whether the governments step in to stop frauds or continue to observe them.

Also, Read| INDIA AND TALIBAN POST-US WITHDRAWAL

Pragyan Jaiminy
Pragyan Jaiminy is currently pursuing his B.tech in Computer Science from JNU,Delhi. His areas of interest are Technology, Science, Economics and Fintech. He loves to read stuff related to every sphere of life. Follow me on twitter : @Irongyan18

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