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Crypto exchange Bybit says a hacker took control of one of its cold Ethereum wallets, resulting in what analysts estimate was the loss of ~$1.5B worth of tokens (www.bloomberg.com)
submitted 1 year ago by to c/technology@lemmy.world
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[–] 25 points 1 year ago (8 children)

How does one get ones hands on a cold wallet?

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  • [–] 64 points 1 year ago* (last edited 1 year ago) (1 child)

    My speculations:

    • "insecure from the start" - as in , the wallet was never that "cold"

    • with that amount of money, it's easy to imagine an "insider threat"

    • the hackers could have gotten lucky and struck right when the company was doing legitimate operations on the wallet

    • but probably it's a towering mountain of incompetence, composed of the elements above and more

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  • [–] 28 points 1 year ago (2 children)

    It's a common misconception that a "cold wallet" is offline. It's still on the blockchain like any other wallet, it's just the keys that aren't on any network-connected computer.

    It appears that in this case hackers managed to trick Bybit employees into entering the keys into a fake UI that gave the hackers access to them.

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  • [–] 17 points 1 year ago (1 child)

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  • [–] 19 points 1 year ago (1 child)

    Do I understand this correctly, then, that this was some sort of MITM attack where valid requests to the multisig parties were replaced by malicious code while still appearing to be valid to the signers? That must be an inside job.

    And this is the first time I have heard the word "musked" in this context.....

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  • [–] 9 points 1 year ago

    Do I understand this correctly, then, that this was some sort of MITM attack where valid requests to the multisig parties were replaced by malicious code while still appearing to be valid to the signers? That must be an inside job.

    I have no idea. I guess they'll release a lot more info regarding this in the next few days.

    And this is the first time I have heard the word “musked” in this context…

    I think his English isn't good looking at the rest of the message. Might be "masked" instead.

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  • [–] 14 points 1 year ago (1 child)

    What I don't quite understand is how there is 1.5 billion in a single wallet. Or how are these things structured?

    This article puts their total assets under management at $15.7b, which are held in different cryptocurrencies with ethereum at just above $5b.

    So I am wondering how they have more than 1/6 of their Ethereum in a single wallet or were these multiple that were connected and got compromised through the same vulnerability? How expensive is it to have more individual wallets? Would it not be feasible to have it split in something like $100m chunks? Or any other more moderate size.

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  • [–] 3 points 1 year ago

    Making more wallets would cost nothing more than a few hundred bytes of storage each for the keys. I have no idea why they wouldn't have split their funds into evenly sized wallets of, say, $1M each.

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