“Poly Network” hacked and $610 million stolen…Why didn’t “Binance” and “Circle” freeze the hacker’s account?
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Answer “Poly Network” hacked and $610 million stolen…Why didn’t “Binance” and “Circle” freeze the hacker’s account?
The “Poly Network” hack has become a hot topic in the crypto community.
The Poly Network suffered the largest hack in the history of Defi, in which hackers managed to drain $610 million worth of cryptocurrency on the Binance, Ethereum, and Polygon blockchain.
As per the latest developments, the hackers behind the attack agreed to return the funds and demanded a secure multi-signature wallet from the Poly Network.
A total of $610 million was stolen, of which $266.5 million was sent to an Ethereum address, $252 million to an address on the Binance BSC blockchain, and $85 million to a Polygon address.
Read:Poll: Only 24% believe the price of Bitcoin will be below $50,000 by the end of 2022
SlowMist, a blockchain analytics firm, discovered the hacker’s IP address and digital fingerprint.
SlowMist found that the initial source of the hackers’ funds was in the form of Monero (XMR), then it was changed to BNB/ETH MATIC and other cryptocurrencies on the platform, then it was withdrawn to 3 addresses.
The company summarized the attack as follows:
This attack is mainly because the guard of the EthCrossChainData contract can be modified by the EthCrossChainManager contract, and the HeaderAndExecuteTx validation function of the EthCrossChainManager contract can execute the data passed by the user through the executeCrossChainTx function.
Therefore, the attacker uses this function to pass carefully generated data to modify the custodian of the “EthCrossChainData” contract.
He told the hacker that the attack would have amounted to $1 billion if he had decided to withdraw the remaining altcoins as well.
He also mocked the protocol’s developers, saying:
What if you create a new token and let the DAO decide where the tokens go
Why didn’t Binance and Circle freeze the hacker’s account?
Once the breach was discovered, the Poly Network required all trading platforms and miners to red flag transactions initiated from the said compromised accounts.
Read:Cryptocurrency exchange FTX acquires a Canadian exchange and expands further into North America
Tether was quick and responsive, freezing $33 million in USDT almost immediately.
. Tweet embed Just froze ~33M American dollar on 0xC8a65Fadf0e0dDAf421F28FEAb69Bf6E2E589963 as part of #PolyNetwork hack
– Paoloardoino August 10, 2021
However, the majority of funds were freely moving on the Binance BSC blockchain which many believe did not take the appropriate steps to block transactions.
Read:UAE Securities and Commodities Authority (SCA) Approves Support for Cryptocurrency Trading
Arguably one of the reasons why Binance has not frozen BUSD transactions is that its affiliated stablecoin cannot be frozen by anyone on the Binance BSC blockchain.
However, Circle could still block the transactions, but they decided to reject them and said they would take legal action instead.
According to Chinese blogger Wu Blockchain, all the parties behind the three digital stablecoins USDT, USDC and BUSD have been notified.
Where the USDT has been frozen.
While the CEO of USDC stated that they want to pursue this legally and not resort to a freeze.
While BUSD has not been frozen due to the lack of this option in the Binance BSC blockchain.
Read also:
Cardano (ADA) Coin Hit its Highest Level in Two Months…For These Reasons!
PolyNetwork Exploitation and $600 Million Crypto Heist
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