As a researcher with experience in the cryptocurrency industry, I find the recent development at Cypher, a Solana-based crypto trading protocol, to be both disappointing and concerning. I’ve followed the project closely since its inception and was hopeful that it would recover from the series of hacks and heists it had endured. However, the latest revelation that one of its core contributors, Hoak, stole hundreds of thousands of dollars worth of cryptocurrencies from Cypher’s hack reimbursement fund is a significant blow.
The cryptocurrency trading protocol built on the Solana blockchain, Cypher, has unfortunately experienced a series of cyberattacks and breaches in the past. However, the most recent incident involving misappropriated funds intended for compensating affected users, turns out to be an internal issue.
On Taylor’s Third, an anonymous programmer using the alias Hoak confessed to pilfering large sums of cryptocurrencies valued at hundreds of thousands of dollars from Cypher’s hack compensation pool. In a public announcement, Hoak acknowledged his actions, admitting, “I squandered the funds in gambling.” He attributed his behavior to an uncontrollable compulsion for gambling.
One day after accusations from Cypher’s founder Barrett, Hoak confessed to allegedly draining significant amounts of cryptocurrencies from the protocol’s redemption contract over several months starting in December. According to Barrett, who provided on-chain data as evidence, Hoak ultimately transferred assets valued at approximately $300,000 (current market value) to Binance for potential cashing out.
Hoak admitted Tuesday that the accusations against him are valid. In a tweet, he expressed his belief that no one would ignore this matter without consequence. Barrett shared with CoinDesk that he had conveyed details about the robbery and Hoak’s real identity to law enforcement and was cooperating with their investigation.
It deeply pains me to learn that our valued team member, who remained committed to helping restore the project following the exploit, is now allegedly responsible for draining funds from the redemption contract. I had not anticipated this unfortunate turn of events.
The Cypher team devised a redemption agreement to compensate affected clients for approximately one million dollars’ worth of damages due to an exploit that occurred in August. Barrett disclosed that the discrepancy in funds was uncovered following a user complaint about complications in processing their redemption.
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2024-05-15 00:28