The attacker kidnapped $ 7.4 million in Ethereum equivalent, hacking the site of the "on-air" startup

Ethereum is a platform for creating decentralized online services based on the blockchain. Ethereum exchange units are usually referred to as “ether”, and this cryptocurrency has a potential of no less than that of Bitocoin, and maybe even more. Despite some problems in the process of becoming a platform, Ethereum is becoming increasingly popular day by day. And this popularity attracts not only well-intentioned users, but also intruders.



Some of them manage to cash in pretty well. Moreover, cybercriminals do not have to use the zero-day vulnerabilities, it is ideal to know the principles of the operation of cryptocurrency protocols and other things. You can simply take and replace the address of the wallet to which the money is sent during Initial Coin Offering (primary placement of tokens), or, in abbreviated form, ICO, on the victim's website. Coindash stated that this was exactly what was done by the attackers with its own website, so that after the launch of the ICO, the investors of this organization sent their funds to the cybercriminals' wallet one by one.



The affected company is a blockchain startup. After the problem became known, Coindash management had to stop ICO, telling investors about hacking their site. During the time when the wrong wallet was shown on the company's website, the attackers were able to get more than $ 7 million to their accounts. A message about the burglary was sent by CoinDash management to all investors, also reported on Twitter.





In just a few minutes translated 43 thousand ethers. At the rate on July 17, this is just over $ 7 million. The most interesting thing is that even when the administration of Ethereum marked this wallet as fake (FAKE_CoinDash), investors continued to send funds to it. As a result, the attackers collected more than $ 7.4 million. So far, the incident is being investigated, but it has become clear that this will not end with anything good. Already, the company is accused of hacking being not hacking at all, but targeted actions by its management aimed at illegal enrichment. A number of affected network users announced their intention to go to court.





The main problem, in general, is the lack of special security measures during the ICO. Placing a text string, depending on the correctness of the content of which determines whether millions of US dollars will go to the correct address, is not the best solution. Just a few minutes was enough for the attackers to receive the principal amount. Initially it was assumed that Coindash’s ICO would run smoothly and without any problems. It is not yet known exactly how the attackers changed the text string on the site, but this was hardly a super-complicated way - hackers of sites know their business.







“All we know is that the attacker changed the address immediately after the start of the ICO,” said Rem Aivissar, marketing director at Coindash. As mentioned above, in hacking some users suspect the management of the company, not hackers. This topic is now being actively discussed on Reddit , laying out more and more new arguments in favor of this point of view. Even those users who do not consider the company guilty of fraud, argue that it is obliged to return the money. “I want to get my money. This is your website, and you are guilty of not having properly taken care of your security, ”said one of the investors, who sent the money to a fake wallet. Another dissatisfied wrote the following: “Too late, I have already invested! 31 thousand airs went to the address! You guys better return my money. ”



This hack is currently one of the largest for companies dealing with Ethereum. An even larger amount was lost last year by the DAF investment fund. Then it was about as much as $ 50 million. This led to the fact that the developers of cryptocurrency even decided to divide the platform into two parts to recover the lost funds. But the majority of users of the system considered that this was an unjustified risk and the administration decided not to make any cardinal decisions.





Despite all the difficulties, the position of "ether" is strong



CoinDash has already announced that it is going to return the funds to its depositors: “All CoinDash investors will receive their tokens back. We are working on resolving the situation. ” The statement that the funds will be returned to depositors has been made. That's just when no one told how it is planned to do. Those funds that went into the wallets of intruders are unlikely to be returned, so either the company will have to pay out of its pretty thinned out wallet, or else nobody seriously plans to return the funds.