As a seasoned analyst with years of experience in the volatile world of cryptocurrencies, I’ve seen it all – from dizzying highs to gut-wrenching lows, and everything in between. The latest string of incidents in the crypto sphere is a stark reminder that this wild west still has its share of bandits lurking around every corner.
The latest crypto scams, hacks and exploits, and how to avoid them: Crypto-Sec
DMM Bitcoin will reportedly liquidate after $320 million hack
According to a report from Nikkei Asia, DMM Bitcoin, the cryptocurrency exchange, has decided to cease operations under its current format and instead, liquidate. Luckily, the account balances and assets of customers will be transferred to their parent company, the SBI Group.
The liquidation comes after DMM Bitcoin suffered a $320 million hack in May.
According to the Nikkei report, it’s been announced that DMM Bitcoin, a cryptocurrency service, will move its customers’ deposits over to SBI VC Trade, which is an exchange platform managed by the SBI Group.
The planned transfer, set for March 2025, encompasses not only traditional stocks but also crypto-related securities belonging to DMM Bitcoin.
On May 31st, a significant cyber-attack occurred, ranking among the biggest in 2024. The perpetrator managed to snatch the exchange’s private key for one of their hot wallets, enabling them to empty it of approximately 4,502 Bitcoins (BTC).
Initially, the blockchain analysis tool Whale Alert flagged a significant transaction, without providing an explanation for it. Later on, DMM Bitcoin disclosed that this large transfer occurred due to a cybersecurity breach in their system.
In June, the exchange announced that it would raise funds to pay customers back.
Rug pulls are on the rise
As a conscientious crypto investor, I’ve been keeping a keen eye on the market trends, and it appears that instances of rug pulls or exit scams have been escalating in November, as per a report by blockchain security firm TenArmor released on November 27th. This alarming rise in such incidents serves as a stark reminder for us Web3 users to exercise extreme caution when contemplating new investment prospects. The increasing frequency of these rug pulls underlines the importance of thorough research and due diligence before diving into any investment opportunity.
Examining their blockchain analysis tool, TenAror discovered a concerning pattern over the past month.
Initially, the system was identifying between four and six instances of rug pulls daily in mid-October. However, this figure skyrocketed to a staggering 31 occurrences on November 14.
The report indicates that numerous recent exit scams have utilized deceptive honeypot tokens with flawed transfer mechanisms. This enables the developers to pilfer coins from users’ accounts. TenArmor advises users to scrutinize a token’s contract transfer function before making a purchase, as this examination usually uncovers fraudulent tokens.
In some cases, the events in question involved individuals falsely producing replicas of well-known cryptocurrencies. According to the report, users can typically steer clear of counterfeit tokens by verifying the official sources of a project, ensuring that the token contract address matches the one they are transacting with.
DEXX memecoin platform exploited for $21 million
As a researcher, I’ve recently come across an unfortunate incident involving the Decentralized Exchange (DEX) platform, DEXX, built on Solana. On November 16th, it appears that the platform was exploited to the tune of approximately $21 million, as reported by various sources on social media and further analyzed by blockchain analytics firm SlowMist. This discovery sheds light on a potential vulnerability within the system, emphasizing the importance of continuous monitoring and improvement in the field of decentralized finance.
Memecoin enthusiast Hope reported the attack on X:
In a post shared via their MistTrack account, SlowMist requested that victims report any “compromised wallet addresses” to them for further action.
On November 18th, SlowMist disclosed that they’d received more than a thousand reports. Analyzing this information, they identified over 900 distinct victims. Among these victims, one suffered a loss exceeding $1 million, and at least two others experienced losses greater than half a million dollars.
The exchange has not definitively identified the reason behind the attack, however, some users suspect it may be due to a breach in the private key.
In their update on X, the DEXX team said they will swiftly reimburse everyone in full as soon as the assets are retrieved by law enforcement agencies.
If we can’t get back the entire sum, the particular compensation method will be determined by the amount that is actually recovered.
Judges squash Tornado Cash sanctions
In a win that benefits both mischievous actors and proponents of privacy, a U.S. Federal Appellate Court reversed an earlier ruling, enabling the U.S. Office of Foreign Assets Control (OFAC) to impose sanctions on the cryptocurrency mixing service known as Tornado Cash.
According to the decision made by the panel, it was determined that the Office of Foreign Assets Control (OFAC) does not have the power to impose sanctions on non-upgradable smart contracts, because they do not meet the criteria of an “entity” as defined in the law. This is due to the fact that these smart contracts are just sequences of code that cannot be controlled by any individual or group.
In simpler terms, this decision allows Ethereum nodes functioning within the U.S. and nations adhering to OFAC regulations to handle Tornado Cash transactions, which could expedite their processing speed.
Earlier, American nodes would only verify transactions once they had been verified by nodes operating in regions where such transactions were legally permissible first. This setup limited the number of nodes that could process the app’s transactions within a block, leading to occasional delays for users.
Tornado Cash functions as a cryptocurrency tumbler, designed to conceal the source of funds in an account. This service has gained traction among cybercriminals like hackers and scammers, who use it to dodge detection by tracking platforms regarding the origin of their earnings from illegal activities.
Additionally, it’s employed by everyday people as well, who seek privacy for their transactions, not because they’re engaging in illicit activities, but merely for personal reasons.
Since its launch, Tornado Cash has been embroiled in controversy. One of its creators, Alexey Pertsev, was convicted by a Dutch court for money laundering charges related to the development of the software. Another developer, Roman Storm, is set to face trial for alleged money laundering and sanctions violations in April. At present, Storm is out on bail as he prepares his defense.
Crypto influencer JRNY reportedly hacked for $4 million
Reportedly, the well-known crypto figure JRNY suffered an attack that resulted in him misplacing his private key, leading to a loss of approximately $4 million in assets such as Apecoin (APE), USDC (USDC), HYVE, KARRAT, Ether (ETH) and BYTES, based on information from blockchain analysis platform Cyvers.
Cyvers detected the assault as the victim’s account was marked due to “unusual activity” and “questionable recipient.
As a crypto enthusiast, I frequently come across content from the pseudonymous influencer known as JRNY, boasting over 760,000 followers on one platform and 590,000 on YouTube. Known for discussing non-fungible token collections like Bored Ape Yacht Club, I haven’t managed to find any acknowledgment of a potential attack on their profiles in the crypto community yet.
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2024-12-03 15:46