More than $600 million in Ethereum and other cryptocurrencies has been stolen, making it one of the biggest hacks in crypto history.
In what is likely to be one of the largest cryptocurrency thefts ever, hackers have returned roughly half of the $600 million they took.
The hackers took advantage of a flaw in Poly Network, a platform that tries to connect different blockchains so that they may function together.
Poly Network announced the hack on Tuesday and requested that the hackers communicate with them, requesting them to "return the hacked assets."
A blockchain is a digital ledger that serves as the foundation for multiple cryptocurrencies. Each digital coin has its own blockchain, which is distinct from the rest. Poly Network claims to be able to connect all of these different blockchains.
Poly Network is a platform for decentralised money. DeFi is a broad word that refers to a range of financial applications based on blockchain technology that aim to eliminate middlemen like brokerages and exchanges. As a result, it's known as decentralised.
This, according to proponents, can make financial applications such as lending and borrowing more efficient and less expensive.
In a tweet, Poly Network said, "The amount of money you hacked is the largest in defi history."
Hackers start to return the funds
The hackers began returning some of the monies they took on Wednesday, in an unusual turn of events.
They included a message in a cryptocurrency transaction to Poly Network stating that they were “ready to return” the monies. The money was to be delivered to three crypto addresses, according to the DeFi platform.
More than $4.8 million had been restored to the Poly Network addresses as of 7 a.m. London time. Around $258 million had been returned by 11 a.m. ET.
“I believe this indicates that, even if cryptoassets can be stolen, laundering and cashing them out is incredibly difficult due to the transparency of the blockchain and the usage of blockchain analytics,” said Tom Robinson, chief scientist of blockchain analytics startup Elliptic, in an email.
“In this situation, the hacker decided that returning the stolen assets was the safest option.”
After stealing the funds, the hackers began sending them to other bitcoin addresses. A total of $610 million in cryptocurrency was transferred to three addresses, according to experts at security firm SlowMist.
SlowMist researchers "grasped the attacker's mailbox, IP, and device fingerprints" and are "following possible identification clues related to the Poly Network attacker," according to a tweet from the company.
The heist was "likely to be a long-planned, orchestrated, and prepared attack," according to the experts.
Poly Network recommended that cryptocurrency exchanges "blacklist tokens" originating from the hackers' addresses.
About $33 million in Tether has been locked as a result of the heist, according to the stablecoin’s issuer.
The CEO of prominent cryptocurrency exchange Binance, Changpeng Zhao, said that he was aware of the incident.
Binance is “coordinating with all of our security partners to provide proactive assistance,” he said, but “there are no guarantees.”
On Twitter, Poly Network stated, "We will take legal action and we urge the hackers to return the assets."
DeFi hacks on the rise
Cybercriminals have made DeFi a popular target.
DeFi-related attacks totaled $361 million from January to July, up nearly thrice from the same period in 2020, according to cryptocurrency compliance firm CipherTrace,
Fraud related to DeFi is also on the rise. It accounted for 54% of overall crypto fraud volume in the first seven months of this year, compared to 3% for the entire previous year.
