The attack targeted DeFiance founder Arthur Cheong’s hot wallet, from where the hacker stole several NFTs, wrapped Ether and other tokens, cumulating in losses worth $1.6 million.
Not Even Seasoned Vets Are Safe
It looks like crypto hackers are getting braver and greedier day by day, constantly testing the waters of how much higher they can hit. The latest high-profile target of such an attack is DeFiance Capital founder Arthur Cheong, who lost millions of dollars worth of assets in a hot wallet attack. News of the hack spread like wildfire on Twitter and caused a stir among the community, with several individuals expressing their shock over such a high-profile target. Self-custody of crypto-assets and their security have always been a hot topic due to the growing number of cyber-criminals aiming higher and higher on the crypto ladder.
Assets Stolen
The hackers mainly targeted Arthur’s NFT collection, with over 78 different NFTs being stolen from five collections, mainly “Azukis.” Other assets from his portfolio that were targeted and stolen include 68 wrapped Ethers (wETH), 4,349 staked DYDX (stkDYDX), and 1,578 LooksRare (LOOKS) tokens. Once the hackers gained control of the assets, they were almost immediately put up for sale on the OpenSea marketplace. The hacker’s wallet had accumulated around 545 ETH, worth around $1.6 million.
Cheong’s Twitter Thread Gives Context
Cheong himself expressed his frustration, tweeting,
“Ok it’s a private key/seed phrase compromise since this little s–t is still transferring some token out”
He followed it up soon with further tweets commenting that he would not depend on hot wallets to store his assets anymore. A hot wallet is always connected to the network and is not as safe as a hardware wallet, also known as a cold wallet, since it is not connected to the network. However, Arthur believes that the root of the breach lies either in a compromised private key for a hardware wallet or a security breach that happened during an onchain transaction.
He tweeted that he had mostly stuck to using a hardware wallet on his PC till he started trading NFTs more regularly.
He has followed up his comments by tweeting that he believed the hackers to be from the notorious Lazarus Group, which is a North Korean hacker group that was accused of stealing $1.3 billion worth of crypto.
“Have strong evidence to believe this is the same group of hackers that exploited BZX, Hugh, MGNR and myself. The infamous Lazarus group.”
Arthur has also addressed the hackers directly, claiming that they have messed with the wrong person.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
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