10 November 2023
Crypto exchange platform Poloniex was attacked by a bad actor, losing over $60 million of its customer’s funds. The Justin Sun led the exchange and launched an investigation, which remains ongoing, to determine the identity of the attackers.
Poloniex Makes Offering To Attackers
The crypto analytics platform Nansen data indicates that over $68 million in tokens left Poloniex over the past day. The image below shows that the attacker stole assets in ETH, BADGER, REN, OKB, NEXO, and 170 other tokens.
Nansen also confirmed that the biggest losses were suffered in top assets, Ethereum and USDT, with around $11 million each. Other tokens such as ELON, USDC, SHIB, and GLM saw inferior losses but still in the millions of dollars.
A few hours ago, as mentioned, the exchange launched an investigation and Justin assured its users that the platform keeps a “healthy financial position.” In that sense, Sun, also the founder of blockchain TRON, claimed that users will be reimbursed for their losses.
The platform is currently exploring a partnership with other crypto exchanges to recover the fund. Sun stated:
We are offering a 5% white hat bounty to the Poloniex hacker. Please return the funds to the following ETH/TRX/BTC wallets. We will give you 7 days to consider this offer before we engage law enforcement.
In the crypto community, some users praised these efforts to recover the fund and encouraged the attacker or attackers to take the bounty for “pointing out vulnerabilities” in the platform’s security. However, other users were critical of the measure. One community member stated:
(…) a white hat doesn’t steal funds and then ask for a bounty, whatever you’re promising, law enforcement will be involved. It’s like saying you can beat someone to death but if you take them to the hospital you’ll be safe (…).
Who Is Behind The Poloniex Attack?
It remains to be seen if the attacker will accept the offer. In the crypto space, many cyberattacks have been conducted by state-sponsored hacker groups, such as the infamous Lazarus Group, allegedly working for the North Korean Government.
According to a report from our sister website, Bitcoinist, this group stole billions of dollars from the nascent industry in the past two years. The terrorist group is allegedly a key component of the country’s nuclear program. Jason Bartlett, a researcher at the Center for a New American Security (CNAS), said:
Cryptocurrency offers Pyongyang a new kind of currency that is substantially less regulated and understood by national governments, financial institutions, and international organizations.
However, cryptocurrencies also operate as an important tool for law enforcement agencies to track down and cut funding for rogue entities. Due to blockchain technology’s transparency, some criminals stay clear of digital assets and crypto exchanges.
As of this writing, Ethereum (ETH) trades at $2,077 with a 7% profit in the last 24 hours.
Cover image from Unsplash, chart from Tradingview