More Than $600 Million Stolen In Ethereum And Other Cryptocurrencies—Marking One Of Crypto’s Biggest Hacks Ever

Author image

Jonathan Ponciano   Forbes U.S. Staff

More Than $600 Million Stolen In Ethereum And Other Cryptocurrencies—Marking One Of Crypto’s Biggest Hacks Ever

Photo: Kevin Ku/Unsplash

Hackers allegedly breached blockchain-based platform Poly Network and extracted more than $600 million in cryptocurrencies on Tuesday, the company announced on Twitter, marking the biggest hack ever in the decentralized finance space that’s heating up among investors.

KEY FACTS

- “We are sorry to announce that #PolyNetwork was attacked,” Poly  Tuesday morning, disclosing that hackers had transferred hundreds of millions of dollars to separate cryptocurrency wallets.

- Cryptocurrency wallet addresses disclosed by Poly, a cross-chain interoperability network, show transfers early Tuesday of 2,858 ether tokens worth about $267 million, 6,610 binance coins worth more than $252 million and roughly $85 million in USDC tokens on the Polygon network. 

- The combined value of the stolen tokens, as of Tuesday morning, totaled roughly $604 million, making it even bigger than the $460 million  on cryptocurrency exchange Mt. Gox that led to the company’s bankruptcy and heightened regulation in the nascent space about seven years ago.

- Soon after the hack, Tether, the company behind the world’s third-largest cryptocurrency by market capitalization, froze roughly $33 million in USDT tokens associated with the alleged hacker’s wallet address,  to its chief technology officer.

- Blockchain-based security firm SlowMist also  a statement hours after the attack, saying it had identified the attacker’s email, IP address and device fingerprints, and was working on tracking additional identity clues.

- Poly, which was founded by the $3.3 billion Chinese cryptocurrency project NEO, did not immediately respond to Forbes’ request for comment.

CRUCIAL QUOTE 

“We call on miners of affected blockchain and crypto exchanges to blacklist tokens coming from the above addresses,” Poly Network  Tuesday.

TANGENT

Crypto-exchange operators spoke out soon after the massive hack. Changpeng Zhao, the billionaire CEO of cryptocurrency exchange Binance  in tweets that the company, which serves as the primary operator of the blockchain on which binance coins are built, will coordinate with its security partners and “do as much as [it] can” to help. Meanwhile, Jay Hao, the CEO of cryptocurrency exchange OKEx,  the company is “watching the flow of coins and will do [its] best to manage the situation.”

BIG NUMBER

$103 billion. That’s the current market value of all decentralized finance tokens (like Polygon), according to cryptodata website CoinGecko. The space shot past a $100 billion valuation for the first time ever this year and peaked at about $150 billion in May before the broader crypto market crashed nearly 50%. 

KEY BACKGROUND

Less than a week before the Poly hack, SEC Chairman Gary Gensler said booming decentralized finance platforms, also known as DeFi, deserve more government scrutiny. The platforms largely sidestep traditional intermediaries like central banks and exchanges for financial services and instead rely on blockchains—and often their own cryptocurrencies—to process transactions. Gensler  such practices can implicate securities, commodities and banking laws, and called on Congress to ramp up its authority over the cryptocurrency industry, which he likened to the “Wild West.” Meanwhile, institutional investors have largely been warming up to the space: Goldman Sachs  month filed to create its own exchange-traded fund investing in DeFi. 

Author image

Jonathan Ponciano   Forbes U.S. Staff

I'm a reporter at Forbes focusing on wealth and finance. I graduated from the University of North Carolina at Chapel Hill, where I double-majored in business journalism and economics while working for UNC's Kenan-Flagler Business School as a marketing and communications assistant. Before Forbes, I spent a summer reporting on the L.A. private sector for Los Angeles Business Journal and wrote about publicly traded North Carolina companies for NC Business News Wire.