The post Atomic Wallet Hit by Massive Hack: $35 Million Worth of Cryptocurrency Stolen appeared first on Coinpedia Fintech News

In a shocking revelation of cybersecurity vulnerability, over $35 million in digital assets were reported stolen from Atomic Wallet since June 2, as per an analysis by an on-chain detective, ZachXBT. The shocking discovery indicates the alarming scale of crypto thefts, with the five largest thefts alone accounting for nearly half of the total amount – $17 million.

An Investigation Underway

Atomic Wallet has publicly announced that the cause of this massive security breach is currently under investigation. Disturbing reports suggest that the hackers managed to not only steal tokens but also erase transaction histories and obliterate entire crypto portfolios.

Renowned for tracing stolen cryptocurrency and assisting compromised projects, independent analyst ZachXBT disclosed that the biggest single loss accounted for $7.95 million in Tether. With further victims being identified, he ominously predicts that the total could exceed $50 million.

Scamming Hack Victims

He also warned about a phishing scam targeting users on Atomic Wallet’s official Twitter account. He noted that the scammer’s account, marked with a verified ‘gold checkmark,’ is misleading users in the midst of the current crisis.

Victims Speak Out

Atomic Wallet reportedly serves over 5 million users globally. Cointelegraph got an opportunity to interact with a long-time Atomic Wallet user who fell victim to this enormous breach. “It’s frustrating because I am a cybersecurity professional,” laments Emre, a Turkish resident who lost nearly $1 million in crypto assets. The stolen tokens included Bitcoin, Dogecoin, Litecoin, Ether, USDT, USD Coin, BNB, and Polygon. The funds were intended to finance a cybersecurity firm’s foundation in Turkey. But how has Atomic Wallet responded to this crisis, and what protections are in place for users?

Atomic Wallet’s Response and User Protection

As a noncustodial-decentralized wallet, Atomic Wallet places the responsibility of asset security on its users. Its terms of service clearly state no liability for any on-chain damages incurred by users. Amid this crisis, the company’s response has been somewhat minimal, mainly focused on gathering victim addresses and reaching out to major exchanges and blockchain analytic firms to track and freeze the stolen funds.

Possible Causes and The Bigger Picture

Some users have speculated that the hack might be linked to an outdated dependency package. Such packages define the sequence and requirements of tasks within an application, and an obsolete one could potentially provide an entry point for malicious actors.

This incident adds to an ever-growing list of cyber-attacks targeting crypto platforms. Recent cases involve Jimbos Protocol losing $7.5 million and a malevolent proposal that managed to seize control of Tornado Cash’s governance. A report by Chainalysis estimates a staggering $3.8 billion stolen by crypto hackers last year, with decentralized finance protocols being the preferred target.

Experts like Dr Martin Hiesboeck, Founder of Alpineblock and Natour.io, are calling this one of the most significant hacks in crypto history, underlining the urgent need to tackle the cybersecurity issue in decentralized finance.

A Glimmer of Hope?

Atomic Wallet tried to alleviate user panic by stating that less than 1% of its monthly active users have reported being affected and that the last fraudulent transaction was confirmed over 40 hours ago. However, with an ongoing security investigation and potential victims yet to be identified, the full scale and repercussions of this breach are yet to be known.

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Filed under: Bitcoin - @ June 5, 2023 5:55 am