Wintermute victim of $160 million scam
Comments about theft from Wintermute CEO
According to a series of tweets by Wintermute's founder and CEO, Evgeny Gaevoy, the attack allegedly targeted the company's decentralised financing (DeFi) operations. Gaevoy promised clients that the company is still "solvent with twice over" the $160 million taken in the residual stock.
As per blockchain research firm Elliptic, these services are "uniquely vulnerable to hacking" due to their open source code, vast pools of assets, and fast growth, which may have resulted in a gap in security best practices in some circumstances.
Details of Wintermute scam
A cryptocurrency wallet address labelled as belonging to the Wintermute exploiter on blockchain explorer platform Etherscan revealed a series of transactions earlier on Tuesday, one of which involved transferring 112 million native tokens of Curve's 3pool, a platform for swapping stablecoins, from a null address to the hacker.
The token exchange consisted of $114.4 million USDT, $61.4 million USDC, and $23.6 million DAI.
Based on research released last month by blockchain monitoring firm Chainalysis, a startling $1.9 billion in bitcoin was stolen in hacks of various platforms in the first seven months of 2022, a 60% rise from the same time the previous year.
Some of the most significant crypto breaches this year have occurred on DeFi protocols, including a $625 million attack in March on a gaming-focused blockchain network that powers the popular video game Axie Infinity. Some of these thefts, notably the Axie affair, have now been linked to North Korean hackers.
Will Wintermute be able to pay lenders?
Wintermute, which Gaevoy started in 2017, is a "leading" digital asset market maker. It has offered liquidity on over 50 different exchanges and cryptocurrency platforms. The company informed users that service disruptions might occur over the following few days.
Wintermute is the highest borrower on the DeFi liquidity marketplace Clearpool, with $22.2 million in USDC outstanding. According to Andrew Thurman, content lead at Nansen, it also has a $92.1 million USDT loan with TrueFi. According to the platform's website, the TrueFi loan will mature on October 15.
Gaevoy concluded his tweet by stating that Wintermute is solvent but issued lenders that they can also recall their loans if they wish.
Author: Emmanuel Baiden
7 years experience within the financial services sector most notably in Sales, Trading, research and writing articles within the crypto space. I have a bachelor's degree in International Business and a Master's in Investment and Risk Finance . I am also an associate member of the Chartered Institute for Securities and Investment.