Hacks targeting crypto-related platforms have risen exponentially in recent times. Recently, a crypto-gaming ecosystem called Vulcan Forged fell prey to a hack attack, losing $140 million (roughly Rs. 1,062 crore) worth of users’ crypto assets. Hackers reportedly accessed the keys of 96 wallets, stealing 23.7 percent of the project’s circulating supply of tokens. The gaming ecosystem provides players with these crypto wallets built on Ethereum, Polygon, and VeChain blockchains and manages the key to these wallets.
Jaime Thomson, the CEO of Vulcan Forged posted a video message on Twitter, acknowledging the breach and calling December 13 the “darkest day in Vulcan Forged history”.
“We use Venly which is a semi-custodial wallet solution. Venly itself is a service, which as far as we know is all fine and has not been exploited or hacked. What has happened is someone has exploited our servers, gotten the Venly credentials and used it to extract the private keys of the Forged users. Going forward, of course, we are going to be using nothing but decentralised wallets so we never have to encounter this problem again,” Thomson said while revealing that the company is using its treasury to reimburse victims of the hack attack.
Thomson basically said that the company will now allow users to handle their own wallet keys rather than taking responsibility for their keys on its servers.
The hackers have stolen assets in Ether, Polygon as well as the native PYR cryptocurrency of Vulcan Forged, which dipped in value after the hack and is presently trading at $20 (roughly Rs. 1,517 per token) on CoinMarketCap.
To make it harder for the hacker to cash out the stolen funds, Vulcan Forged had asked its community members to pull out funds from the liquidity pools on decentralised exchanges.
The cyber-criminal however, managed to sell small batches of PYR for Ether. As per a report by The Block Crypto, $2 million in PYR (roughly Rs. 15 crore) are lying in one compromised wallet, now under the hacker’s control.
The company has asked affected members to set up accounts with MetaMask to receive their compensation.
Update: The majority of PYR has been refunded to affected wallets from the VF treasury.
We have isolated the tokens stolen from all CEX exchanges. We are working to identify footprints.
A 100% decentralized solution was perhaps the ray of light in this.
All dev carries on.
— Vulcan Forged (@VulcanForged) December 13, 2021
The crypto market is currently witnessing a global boom with the overall market cap touching the $3 trillion mark (roughly Rs. 2,22,79,296 crore) mark, as per market research tracker CoinGecko.
In October, a major hack attack cost Ethereum-powered lending protocol called “Cream Finance” $130 million (roughly Rs. 972 crore) worth of crypto assets.
A recent report has revealed that cryptocurrency-related crimes in 2020 have amounted to around $10.52 billion (roughly Rs. 79,194 crore).
Earlier in November, US’ Federal Bureau of Investigation (FBI) had said that cyber scammers are making innocent people use physical cryptocurrency ATMs and digital QR Codes to complete malicious transactions and dupe them of their assets.
