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Last week, there was a massive hack to the tune of $150 million at the KuCoin Exchange. The hack exposed the vulnerabilities of the hot wallet system and the malicious attack has pro activated the efforts of other exchanges and networks so that they can safeguard the tokens against further attempts.
Tether and its team made an announcement that in order to stay a step ahead, it had frozen a total of $33 million USDT that were stolen from the exchange. Out of this humongous total, $20 million was also ETH-based USDT. Tether also plans to go on to freeze an additional $1 million on the Omni network and a $1 million on the Tron network.
The proactive action to freeze stolen funds by Bitfinex and Tether has inspired other Ethereum-based projects also to take a similar course of action so that the hackers do not further undertake any hold-up and profit from it.
BitFinex’s decision questioned
The CTO of BitFinex and Tether Paolo Ardoino had to answer questions from crypto lovers about why it froze $33 million USDT stolen on KuCoin and an additional $2 Million later. Tether froze $1 M USDT on Omni Network and $1 M USDT on Tron. He defended the action of freezing funds by explaining that Tether has a duty towards its users. He tweeted:
Source: Twitter
Major action taken by Ethereum based projects
The KuCoin exchange hack has been unfortunate but the exchange is doing everything it can to regain the confidence of the investors by backing their funds with insurance. But, as a food for thought, several Ethereum-based projects are taking one step further to logjam their networks to prevent any such thing. Let us name a few prominent projects that have decided to take action and protect their respective networks from any hack attempts:
- Ocean Protocol’s first action was to immediately stop its smart contract. As a preventive action is decided to carry out a hard fork of the Ocean Token Contract. This will have the effect of reversing any ill-effect of the hack for those users who choose to adopt the latest version of the contract. The hard fork was carried out at a block height of 10,943,665 on the Ethereum Mainnet to nullify $8.6 million in stolen OCEAN tokens.
- The Orion project and the KuCoin team have committed to a 1:1 token SWAP at a block height of 10,939,462 in a bid to protect ORN from any security mishap.
It was not just Ethereum-based that took foresighted action but other projects on other networks were also affected by the hack and decided to take similar action. Kardian Chain has decided to perform a 1:1 token swap to protect KAI holders as a preventive measure from the hack.
The hack amount is getting bigger and yesterday the amount of funds stolen from KuCoin has increased to $203 million when KuCoin continued to provide crypto addresses linked to the hack. KuCoin provided a list of new addresses of Bitcoin, Ethereum, Litecoin, XRP, Bitcoin SV, Stellar (XLM), Tether (USDT), and Tron (TRX)