Fantom Foundation Hack $550,000 Loss, Not $7 Million

Fantom Foundation Hack: $550,000 Loss, Not $7 Million

News, Altcoin news

The Fantom Foundation, developer of the Fantom blockchain network, has confirmed it was the victim of a recent hack – but states the actual loss was around $550,000, not the $7 million originally reported.

In a statement on October 17th, Fantom said that while one of its wallets was compromised, over 99% of the foundation’s funds remain intact. The majority of stolen crypto belonged to other Fantom users.

Initial reports from blockchain security researchers indicated almost $7 million was drained across wallets purportedly tied to the foundation.

However, Fantom clarified that some of the compromised wallets were mislabeled by blockchain explorers and had already been transferred from the foundation to employees. Only one wallet still contained foundation assets.

The team continues investigating the breach to determine how the wallets were accessed. The hack impacted the Fantom Foundation itself, not the underlying Fantom network, which houses $45 million in decentralized finance (DeFi) assets.

On-chain sleuth ZachXBT first raised alarms of a possible attack after noticing suspicious transactions from supposed Fantom Foundation wallets.

But Fantom stressed the analysis missed nuances around wallet ownership. While monitoring services rely on heuristics, wallet labels can become outdated as assets change hands.

By preemptively publicizing the $7 million figure, the reports caused temporary panic and spread misinformation before details were known. The incident highlights challenges in analyzing blockchain data to discern complex on-chain events in real time.

While the actual loss was closer to $500,000, the Foundation is taking steps to bolster security across associated accounts. Robust controls and monitoring are especially essential for blockchain networks managing valuable crypto deposits like Fantom.

This breach targeted Fantom itself, not a protocol on top of its network. However, previous hacks of DeFi platforms utilizing Fantom do raise concerns over security practices within its decentralized ecosystem.

Fantom’s native FTM token fell 6% following initial news of the attack but has since recovered. The quick correction indicates investors were relieved that the damage was less severe than first portrayed.

Compiled by Coinbold

The Fantom Foundation, responsible for the development of the Fantom blockchain network, found itself in the eye of a storm. A recent hack had tongues wagging, with initial reports suggesting a staggering loss of $7 million. But, wait for it – the real figure was closer to $550,000, a considerable difference.

The story unfurled on October 17th when Fantom took the stage to address the situation. While one of its wallets fell victim to a security breach, the foundation made a critical point: over 99% of its funds remained untouched. The majority of the funds that were pilfered didn’t even belong to the foundation. They were the holdings of other Fantom users.

The initial shocker came when blockchain security sleuths reported that nearly $7 million had been siphoned off from wallets seemingly connected to the foundation. But Fantom had a twist in this tale. Some of these so-called compromised wallets were, in fact, mislabeled by blockchain explorers. They had already been transferred out of the foundation’s hands and into the wallets of employees. Only one wallet still contained foundation assets.

So, what’s the team doing about it? They’re hot on the trail, dissecting how these wallets were breached. It’s worth noting that this hack didn’t target the Fantom network itself, but rather the Fantom Foundation. The network, by the way, plays host to a whopping $45 million in decentralized finance (DeFi) assets. The show must go on.

Enter ZachXBT, an on-chain detective who first raised alarm bells by spotting fishy transactions from wallets that claimed association with the Fantom Foundation. However, Fantom emphasized that such analyses sometimes miss the subtleties of wallet ownership. You see, those wallet labels can age like fine wine, becoming outdated as assets change hands.

The $7 million figure that got tongues wagging? It was an anticipatory guesstimate, courtesy of premature reports. It caused quite the ripple in the crypto pond, leading to temporary panic and misinformation. This incident underscores the complexities of navigating blockchain data in real-time to uncover the truth.

Now, here’s the bottom line – the actual loss was around $550,000, and the Fantom Foundation isn’t taking any chances. Security is the name of the game, and they’re tightening the screws across all related accounts. In the world of blockchain, where valuable crypto deposits are the currency of the day, robust controls and vigilant monitoring are nothing less than lifelines.

The breach may have targeted Fantom, but it raises a more significant question. Is the decentralized ecosystem, which it’s a part of, fortified against security breaches? Previous hacks on DeFi platforms utilizing Fantom have sounded the alarm. Security is not just a necessity; it’s the cornerstone of trust.

In the aftermath of this whirlwind, Fantom’s native FTM token took a hit, falling 6%. Yet, it’s a testament to the resilience of this crypto world that it quickly bounced back. Investors, it seems, were somewhat relieved that the initial catastrophe was far less catastrophic than predicted. The crypto rollercoaster never fails to keep us on our toes.

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