The largest cryptocurrency hack in history has just taken place, causing more than 600 million USD in damage

Poly Network is a protocol that allows token swaps between blockchains established by an alliance of groups that have created blockchain-linked platforms, including Neo, Ontology, and Switcheo. The blockchain chains in the Poly Network include Bitcoin, Ethereum, and Ontology.

The stolen assets amounted to $611 million, including $273 million in Ethereum tokens, $253 million in Binance Smart Chain tokens, and $85 million in USDC tokens on the Polygon network.

Immediately after being notified of the theft Tether blocked the transaction in USDT for Ethereum stolen in the last attack, so it could not be traded anymore. These tokens are worth about 33 million USD. USDT is a stablecoin issued by Tether Limited, has a value of approximately 1 USD and is subject to trading freeze by the company that operates it.

The above attack has affected 3 platforms using this protocol. The O3 trading team had to announce the suspension of the cross-exchange feature while waiting for information from the Poly Network team.

According to BlockSec, a blockchain security corporation based in China, the cause of this hack may start from the disclosure of the private key used to sign cross-chain transactions. Another possible cause is that Poly's transaction confirmation process contains a bug.

Blockchain security group SlowMist said it was able to track down the email address, IP and device fingerprint (device usage data). Through investigation, they believe that this attack was organized and prepared for a long time.

While the investigation was still going on, an account alerted the hacker that USDT was frozen and was donated 13.37 ETH (42,000 USD) by the hacker.

The attacker also claimed that he could take up to 1 billion USD but did not want to touch the remaining dirty coins.

Kareem Winters

Update 11 August 2021