ShadowFi Has Been Exploited For $300K: Details
- ShadowFi, a privacy-focused crypto firm, has been exploited, and over $300K has been lost due to the incident. The hack was also confirmed by PeckShield, a blockchain security firm.
- An attacker drained ShadowFi’s liquidity pool contract, leaving it with zero funds. There was a vulnerability in the SDF token.
Decentralized financial payment network ShadowFi recently faced a cyber attack, with a reported loss of $300,000.
ShadowFi confirmed the news on Twitter, revealing that the attacker drained its liquidity pool contract, emptying it to zero funds. The renowned blockchain security firm PeckShield sounded the alarm about the hack. It claimed that the protocol was exploited due to vulnerabilities in the SDF token, resulting in a loss of $300,000.
Peckshield believes that the vulnerability allowed anyone to burn the token without authorization. The hacker, who was named NeorderDAO by Peckshield, deposited the stolen funds into now-sanctioned Tornado Cash.
Ethereum-based crypto mixer Tornado Cash is widely used by hackers and individuals who want to conceal the source of the funds, resulting in heavy money laundering activities. According to the United States Treasury Department’s Office of Foreign Assets Control (OFAC), the system has been used to launder around $7 billion in cryptocurrencies since 2019.
With the exploiter of ShadowFi’s most recent use of the crypto mixer not yet apprehended, Tornado is still operational despite the ban. Before moving to Tornado, the exploiter reportedly exchanged roughly 8.4 SDF tokens for 1078 BNB.
On the other side, ShadowFi demonstrates that the team is dedicated to working towards a solution that is to the consumers’ advantage. According to the DeFi protocol, it is requested that users display patience while the team is investigating the problem.
Rise in hacks in the DeFi space
Authorities and players in the crypto industry are increasingly becoming the targets of hacking on cryptocurrency platforms. The rising rate of hacks in the sector has the crypto community on edge. KyberSwap was the subject of an attack on September 1 that caused over $265,000 in damages. The company acknowledged the hack and offered the hacker a 10% incentive for returning the stolen funds.
The Federal Bureau of Investigation (FBI) recently issued a fresh warning in response to the increasing number of hacking incidents targeting the DeFi space. The warning states that the hackers exploit vulnerabilities in the smart contracts that govern the platforms by using techniques such as flash loan attacks, signature verification vulnerabilities, and manipulating cryptocurrency prices.
A crypto journalist with over 3 years of experience in DeFi, NFT, metaverse, etc. Parth has worked with major media outlets in the crypto and finance world and has gained experience and expertise in crypto culture after surviving bear and bull markets over the years.
