March 27, 2024
Latest Cryptocurrency News

KyberSwap Hacker Moves Millions Across Blockchains as Fallout Continues

In a recent development surrounding the KyberSwap decentralized exchange (DEX) hack of 2023, the perpetrator responsible for the attack has been observed transferring millions in digital assets across different blockchains. Blockchain analytics firm PeckShield reported on February 26 that the hacker behind the KyberSwap breach bridged 798.8 Ether, equivalent to almost $2.5 million, from Arbitrum to the Ethereum network.

Additionally, the attacker moved approximately one million dollars in stablecoins, with $826,500 in Dai being transferred from a wallet linked to the exploit to another.

The KyberSwap hack, one of the largest security breaches in 2023, unfolded on November 23 when the DEX informed its community about a “security incident” and urged users to withdraw their funds. Initially estimated at around $46 million, further investigation revealed that the total losses reached nearly $49 million.

During the attack, the hacker left an on-chain message to the KyberSwap team, hinting at negotiations after he was “fully rested.” Subsequently, KyberSwap offered a $4.6 million bounty in return for the recovery of 90% of the stolen funds. However, negotiations took an unexpected turn when the hacker expressed dissatisfaction with KyberSwap’s approach, threatening to further delay talks if the team persisted in legal threats and what he perceived as unfriendly behavior.

Surprisingly, the hacker altered the narrative by demanding complete control over KyberSwap and its assets, including temporary full authority and ownership over KyberDAO—the governance mechanism for Kyber. The ultimatum was set for December 10, 2023, before the hacker claimed the “treaty falls through.”

In response to the hacker’s demands, KyberSwap took the unprecedented step of launching treasury grants for the victims of the hack. On December 2, 2023, the team announced grants to those who lost funds in the exploit and had not seen recovery. The aftermath of the hack also had a substantial impact on KyberSwap, leading to a significant reduction in its workforce, with half of its employees laid off a month after the security breach.

As the hacker continues to move assets across blockchains, the crypto community closely watches the evolving situation, wondering about the potential implications for KyberSwap and its users.

Image by macrovector on Freepik

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