Blockchain analytics firm PeckShield has reported significant movements from the wallet address linked to the KyberSwap attacker. The hacker, responsible for the exploit on the decentralized exchange (DEX) KyberSwap, has transferred approximately $2.5 million worth of digital assets from Arbitrum to the Ethereum network.
Background of the KyberSwap attack
The attacker bridged 798.8 Ether (ETH) valued at $3,161 each, totaling nearly $2.5 million, from Arbitrum to Ethereum. Additionally, the hacker moved approximately $826,500 worth of Dai (DAI) stablecoin to another wallet.
This development follows the KyberSwap attack, one of the largest hacks of 2023, where around $46 million in digital assets were initially reported stolen, later revised to almost $49 million.
The KyberSwap security breach occurred, prompting the DEX to notify its community and advise users to withdraw their funds.
The hacker left an on-chain message to the KyberSwap team, suggesting negotiations would commence after adequate rest. Initially offered a $4.6 million bounty in exchange for returning 90% of the stolen funds, negotiations soured when the hacker expressed dissatisfaction with KyberSwap’s approach.
Hacker’s ultimatum KyberSwap’s response and fallout
The situation escalated when the hacker demanded total control over KyberSwap and its assets, including temporary full authority and ownership over KyberDAO, the governance mechanism for Kyber.
A deadline was set, threatening consequences if demands were not met. In response, KyberSwap initiated treasury grants for hack victims.
The incident also impacted the company, leading to a significant reduction in its workforce one month after the exploit.
Implications of stolen fund transfer
The movement of stolen funds from Arbitrum to Ethereum underscores the ongoing challenges faced by decentralized exchanges in safeguarding user assets. Despite efforts to negotiate with the hacker, KyberSwap’s resolution remains uncertain.
The incident highlights the importance of robust security measures and proactive response strategies within the decentralized finance (DeFi) space.
The KyberSwap hacker’s recent transfer of stolen funds to Ethereum signals a continuation of the aftermath of one of the largest hacks.
With millions worth of digital assets moved across blockchains, the incident underscores the need for heightened security measures and proactive response strategies within the decentralized finance sector.
As negotiations between KyberSwap and the attacker remain unresolved, the broader implications on DeFi security and governance mechanisms remain a topic of concern.
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