KyberSwap hacker moves $2.5M to Ethereum

KyberSwap was targeted by a hacker who moved $2.5 million of stolen digital assets to Ethereum’s Arbitrum network.

The hacker responsible for the attack on KyberSwap, a decentralized exchange (DEX) moved millions of digital assets from one blockchain to another. PeckShield, the blockchain analytics company, tracked movements posted by the KyberSwap attacker’s wallet address on February 26.

Blockchain information indicates that the hacker connected the Ethereum network to Arbitrum by bridging 798.8 Ether (ETH) or about $2.5 million.The hacker sent nearly a million dollars’ worth of stablecoins. Someone moved $826,500 worth of Dai (DAI) stablecoin from a wallet associated with the exploiter to another wallet.

Among the biggest cyberattacks of 2023 was the KyberSwap attack. The DEX notified its users on November 23 of a “security incident” and recommended that they remove their money. The hack first stole approximately $46 million worth of digital assets. They subsequently discovered that the total amount lost was about $49 million.

That day, the hacker also sent the team an on-chain message stating that talks would begin when he had “fully rested.” The team offered the attacker a $4.6 million bounty in exchange for 90% of the funds taken.However, when the hacker began to voice his displeasure with KyberSwap’s methodology, the reward discussions took a bad turn.

KyberSwap Hacker’s Demands Lead to Layoffs

In an on-chain message on November 29, the hacker threatened the team saying that if they persisted in threatening legal action and acting in a way that the hacker deemed unfriendly, they would have to postpone further conversations. The hacker eventually took an unexpected turn and demanded complete control of the KyberSwap corporation and all of its resources.

The hacker also sought ownership and temporary total control over KyberDAO, which serves as Kyber’s governance framework, as well as all related documents. Before the “treaty falls through” the hacker gave the firm until December 10, 2023, to make a decision.

In response to the hacker’s demands, the KyberSwap team decided to offer Treasury grants to the hacking victims. The group declared on December 2, 2023, that those who lost money in the exploit and were unable to get it back will receive a grant. The attack, one month after the vulnerability, resulted in the layoff of half of the company’s employees.