Breaking News

Hackers, Scams and Attacks - Breakdown 2017's biggest blockchain disaster

Hard fork? Soft fork? ICO?

In 2017 we were bombarded with unfamiliar technical terms and consumers in the blockchain sector were once again targeted by hackers and criminals. But not all hacking and fraud reasons are the same. Some come from bubbles - either because of their size or influence, what they call the state of the blockchain technology and the industry itself.
However, the impact of these events is far from academic. Whether it's a simple wallet hacker attack, a fraudulent ICO or a software bug, investors have lost hundreds of millions of dollars this year, losing almost $ 490 million in the events listed below.

So far, none of the perpetrators of these crimes have been caught or even identified. It is doubtful if these funds can be recovered.

1. CoinDash ICO attack
Earlier this year, payment and transportation startup CoinDash launched an ICO, but the project was soon terminated because of a hacker's attack on its ETH address for fundraising.

The project raised $ 7.3 million before hackers changed the ETH address for the project, causing the funds to flow to an unknown party. The company later closed the ICO but promised to send it to participants for local token (CDT) rewards.

Although the company said that anyone who still sends ETH to this hacker-substituted address after the company's announcement will not receive the token, some investors continue to send money to the hacked address, unwittingly The stolen money was raised from seven million U.S. dollars to 10 million U.S. dollars.

All in all, the incident shows that the growth experienced by the ICO is painful. Although this model can raise a lot of money, it still needs to face the complexity of an earlier technology.

2.Parity purse loopholes
2017 is a tough year for crypto wallet provider Parity, where Parity occupies two seats.

In July of this year, the British start-up found a loophole in its wallet version 1.5 software that resulted in at least 150,000 ETH being stolen.

The bug was found in Parity's multi-signature wallets, which caused several companies to block ICO financing. At the time these ETHs were worth about $ 30 million, but by mid-December these ETHs were worth nearly $ 105 million.

The issue was identified as "grave" as Gavin Wood, CTO of the company, announced that at least three addresses had been compromised and said they were working hard to stop further financial losses.

It was later discovered that more than 70,000 ETHs have been cashed or redeemed in some form to ensure that their losses are permanent.

3.Enigma project fraud
On the issue of returning to the ICO, the problem is not limited to the destruction of encrypted currency addresses.

Blockchain startup Enigma's website, mailing lists and a Slack Channel Manager account were hacked and fraudsters launched a counterfeit tokens pre-sale in August, tricking investors into over 1,500 ETHs.

These hijacked accounts promised a huge return on investment, disguised as the real operator of the project, which convinced unsuspecting consumers to donate to ruined sites.

Although the Enigma team successfully regained control of the company's account, the ETH wallet used by the attacker was emptied and the funds were no longer available for recovery.

4.Parity wallet frozen
Perhaps this is the biggest security incident of this year, but the accident was also the only one in the list not malicious.

In November of this year, a Parity user accidentally discovered a software bug in the Parity wallet and frozen more than 275 million ETHs, making it the second major accident in 2017 for the wallet.

As one of the two most widely used wizards by Ethereum, these events raise questions as to what the central infrastructure of the Ethereum network is and prompted some to question the company's products and once again criticize Ethereum itself .

In subsequent updates, developers have been working hard to restore the funds, but now that people think that the restoration of these funds will require all Ethereum users to upgrade their software.

5.Tether token attack

Another notable incident that has not yet been solved by the controversy is that at the end of November more than $ 30 million of the cryptocurrencies linked to the dollar, Tether, were stolen. 
At the time, Tether claimed that roughly $ 31 million 'worth of tokens were taken from their virtual treasury and sent to an unknown bitcoin address.

At the time, Tether claimed that about $ 31 million of tokens were extracted from their virtual vaults and sent to an unknown bitcoin address.

This is not common in the cryptocurrency economy, and the attack adds to the criticism of Tether, a blog that is being pushed by the blog and the mainstream news media to review the company.

The company later blacklisted stolen tokens through an update to the omni protocol. However, Tether continues to be plagued by allegations.

6- Bitcoin gold fraud

Think bifurcation is puzzling? The same is true for fraud, and those who want to redeem those new tokens that split up from the Bitcoin blockchain can easily be targeted.

For example, shortly after bitcoin branded Bitcoin Gold, some bitcoin users were drained of money after using a service approved by the project development team.

As a way to authenticate users' access to bitcoin gold, which is effectively free for bitcoin owners, the site's operators have stolen more than three million U.S. dollars in bitcoin, Bitcoin Gold, Ethernet Square and Litecoin.

The Bitcoin Gold Development team claims no formal relationship with the developers of the site and has volunteered to set up a wallet inspection service and provide open source code. The site's developer initially claimed that the site was compromised, but then cleared its GitHub and stopped responding to users on the Slack channel.

In general, this is another case in which consumers are trapped by the promise of free money.

7.NiceHash attacked

This does not mean that these veteran companies are spared one by one in this year's attack.

In early November of this year, NiceHash, a well-known market for cryptocurrencies, was hit by hackers and later confirmed that about 4,700 bitcoins were stolen. At that time, these bitcoins were worth nearly 78 million U.S. dollars. It was later revealed that an employee's computer was compromised, giving attackers access to the system's market and diverting Bitcoin from the company.

Marko Kobal, chief executive of NiceHash, later announced that the team is trying to determine how the attack took place, but it will take time to figure out exactly what happened.