Solana was the victim of a $6 million heist that cleared out over 8,000 wallets in the early hours of 3 August. The exploit happened the day after the cross-chain bridge, Nomad, was lost to another hack to the tune of $190 million.
However, there has been an update to the Solana hack after some investigation. According to Solana blockchain developers, the exploit resulted from the negligence of the web3 wallet provider, Slope wallet.
After an investigation by developers, ecosystem teams, and security auditors, it appears affected addresses were at one point created, imported, or used in Slope mobile wallet applications. 1/2
— Solana Status (@SolanaStatus) August 3, 2022
Why the “Slope-ry area”
According to the statement, Solana’s ecosystem was not to be blamed for the loss. Solana foundation explicitly pointed at Slope because most of the affected wallets were linked to it.
In its response, the Slope team also admitted that it had a lot of wallets drained due to the hack. Similarly, Phantom wallet confirmed Solana’s findings, which had some of its users touched by the hack.
Based on the findings, Solana Foundation noted that Slope wallets may have hosted users’ private keys on centralized servers. Additionally, reports from other corners mentioned that the hackers could have gained access to users’ wallets.
Hot wallets only
In another related development, Solana CEO, Anatoly Yakovenko had earlier linked the exploit to a supply chain issue. However, its communications lead, Austin Fedora, revealed that it was not the case in a follow-up update.
In his tweet, Fedro said,
“It seemed to impact desktop wallets, mobile wallets, wallets of active degens, and wallets that had only ever received one transaction. If this was a supply chain attack hitting all these users, that would have been very scary for all of web3”
Furthermore, he suggested that users who still had assets in their Slope wallet could move them to a secure hard wallet.
At press time, Solana confirmed that investigations were still ongoing to find the perpetrators.
But what’s up with Nomad?
As per the Nomad exploit, there has been some progress. Earlier, the hackers returned around $9 million to the bridge.
#PeckShieldAlert PeckShield has detected ～$9m has returned into @nomadxyz_ Funds Recovery Address, including 100 $ETH (~$164k) from address with ENS name bitliq.eth, ~3.78m $USDC, ~2m $USDT, ~15.8m $CQT (~$1.38m), ~1.2m $FRAX (~$1.2m), 200 $WETH (~328k), ~150k $DAI and etc. pic.twitter.com/Bpyjt7jnek
— PeckShieldAlert (@PeckShieldAlert) August 3, 2022
Then they followed it up with another $3.8 million in USDC, ETH, and USDT, especially after Nomad publicly pleaded for a return. However, it may seem that the Nomad hackers may not send back all of the exported funds.
According to the blockchain security firm, PeckShield, the hackers have been laundering some of it by sending it from wallet to wallet.
.@RariCapital exploiters transferred ~2 $ETH to 0x72ccbb and 0x76f455 (1 $ETH/address) which was used to pay for gas fees on transactions associated with @nomadxyz_ exploit, @RariCapital (Arbitrum) exploiters gained ~$3m, 0x72ccbb and 0x76f45555 gained ~$2m in the exploit. pic.twitter.com/aOpeACWHq4
— PeckShieldAlert (@PeckShieldAlert) August 4, 2022
Axie Infinity holders have reasons to celebrate market drawdown
The market crash has affected every cryptocurrency in some or the other way. And, the recovery from the same has been a nightmare for many. But not for the Axie Infinity holders.
These GameFi token holders stand to be some of the most thriving individuals when compared to the investors of other cryptocurrencies.
Axie Infinity, no worries
The altcoin marked its all-time high of $160 back in November 2021. However, it has consistently been on a downtrend.
Down by almost 90%, AXS was seen trading at $17.8 on 9 August after rising by about 40% from the lows of the June crash.
Now, in such a case, at least a majority of the investors would be bound to take a hit in some or the other way. But surprisingly, not a lot of investors are suffering losses.
This is because even before Axie Infinity came anywhere close to its all-time high (ATH), the investors were already in profit since they had been accumulating for a very long time.
Consequently, in November, not even 1% of the investors were at a loss. However, as prices began falling, their profitability did too.
Plus, the ones who bought their supply around the time AXS was at its highest point are a part of the cohort which noted losses. Their FOMO purchase is taking a hit as the price has returned to its 15-month lows.
At the moment, after a 40% recovery over the month, Axie Infinity investors are noting a slight improvement, although 22.29% of them are still at a loss, which is still a far lower concentration in comparison to the market.
But even for these 22.29% investors, profits do not lie millions of miles away from the ATH.
As the loss-bearing holders’ concentration would come down to just 6%, AXS would be a profitable investment once again.
USDC, USDT, BUSD caught in the midst of tornado- Here’s how
The invention of Bitcoin [BTC] in 2008 led to the idea of decentralization which became the mantra of the entire crypto ecosystem. However, it was necessary to involve regulators and central authorities because of some illegal activities and their negative effect on unsuspecting investors.
The latest is the money laundering enterprise set up by Tornado Cash, which has somehow pointed to some defects around stablecoins. The mission behind the platform creation was to let users make private transactions using the Ethereum [ETH] network. However, they went beyond their jurisdiction.
According to a New York Times report on 8 August, Tornado Cash has been involved in laundering over $7 billion worth of stolen cryptocurrency.
This led the United States (US) treasury department to blacklist the company. Similarly, Circle, the company behind stablecoin, USDC, froze the accounts of its users linked to the platform.
This action led to conversations around the true nature of crypto decentralization. Crypto investor and Bankless CEO Ryan Adams referred to the action as an “assault on crypto.”
Today the US sanctioned Ethereum addresses associated w/ a privacy service called Tornado cash.
Circle immediately froze the USDC in those accounts. GitHub suspended contributors to Tornado.
If you were waiting for the opening shot of big brother’s assault on crypto this was it
— RYAN SΞAN ADAMS – rsa.eth 🦇🔊 (@RyanSAdams) August 8, 2022
In response to the same decision, a researcher at Proximityfi, a NEAR-based DeFi platform, said that the crypto community needed actual decentralized stablecoins.
According to him, the trio of Circle [USDC], Tether [USDT], and Binance USD [BUSD], were past their relevance.
After recent events, it is time the crypto space develops a new stablecoin that is
– 100% decentralized
– censorship resistant
– truly resilient
In this thread I’ll explain and summarize one interesting idea to issue a BTC/ETH-backed stablecoin using derivatives contracts 🧵👇
— Res ®️ (@resdegen) August 8, 2022
In the thread, he explained that the top three stablecoins in market value do not align with the ideas behind decentralization.
Additionally, he mentioned that there were genuinely decentralized stablecoins that were not as popular, including RAI and LUSD, revealing that Ethereum Founder Vitaik Buterin was a big fan of the former.
He went further by proposing the idea of a stablecoin backed by BTC or ETH to achieve true decentralization.
Interestingly, there have been debates about USDC superseding USDT. So will this latest proposal bring an end to both stablecoins?
At press time, the Tornado cash website had been brought down with its developers booted out of GitHub. However, there was no response from the camps of Circle, Tether, or Binance regarding the proclamation.
In conclusion, the recent actions of Circle may contrast with its earlier claims.
On 18 June, CEO Jeremy Allaire debunked claims that the company could freeze accounts at any point.
With the recent happenings, it may seem that the concerns of EthHub founder Anthony Sassano were valid. The future will tell where USDC, BUSD, and USDT go next or make improvements.
Assessing the odds of Polkadot [DOT] sustaining its growth
Polkadot has been grabbing headlines recently with its performance. The latest updates on the network have added fuel to DOT’s uptrend in the crypto market.
This has made DOT the highest performing crypto asset among CoinMarketCap’s top 10 tokens. DOT, at press time, was trading at $9.01 after gaining a significant bull charge over the week by 16.35%.
The token has, however, lost momentum since 8 August and has taken a hit of 3.34%.
Dotting the map
According to data from Lunar Crush, Polkadot has scaled new heights during this week. In a weekly review update, Polkadot Insider has provided information to support this claim.
Social signals of the network suggest that Acala, Moonbeam, and Astar are the most influential projects on Polkadot right now.
Social mentions of Polkadot have clocked around 211.29k while social dominance has racked up at 0.40% over the period under review.
Impressively, social engagements surrounding Polkadot have crossed more than 700 million during the first week of August.
Furthermore, the Polkadot-based Astar network has announced a partnership with Alchemy Platform to accelerate dApp development.
This news release will certainly be a boost for Polkadot as it will promote user growth on it.
Another Polkadot-based network, Phala, has launched a stake pool description function on its application.
It will allow pool owners to access social channels such as Discord and Twitter directly from the application.
1/ Last week the Polkadot ecosystem continued building, deploying and growing. Check out some of the announcements from the ecosystem and hear the latest news from the parachain teams, infrastructure providers, and wallets in this week’s #PolkadotRoundup.
Read the 🧵below
— Polkadot (@Polkadot) August 8, 2022
Well, Polkadot has certainly shown growth in several on-chain metrics. The market-wide sentiment has provided a timely boost to support Polkadot in its future.
However, a report suggests that DOT could yet see a near-term setback. It followed bears at press time after noting a negative change in the past day.
A sudden setback has shifted the course of network volume which was still 36% up on 9 August.
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