Cryptocurrency Exchange

Interesting Turn of Event- 2018’s Bancor’s Security Breach Hackers Move Back 25,000 Ethereum (ETH) to Huobi


Remember, last year there was Bancor’s security breach? Well, there has been an interesting addition to the story. Recently, the hackers behind the Bancor’s security breach seemed to push the stolen ETH back to the crypto exchange- Huobi. This has happened after several months of zero activity. On this, Sentinel Protocol’s cybersecurity researcher- Elizabeth Yeung- “the Uppsala Security Operations Team picked up on the move and analyzed blockchain data to reach its conclusion,” as per the latest reports.

For those who are still trying to recall what happened in the Bancor’s security breach, well here is a summarized version. Bancor Hack address was noted on the Etherscan. This address, in the first go, received around 12.5 million US Dollars worth of Ethereum, which were stolen from the decentralized crypto exchange. The Sentinel Protocol’s cyber security’s team revealed that almost all the ETH was moved to one crypto address, which was later on divided into funds through many branched transactions.

Sentinel Protocol’s cyber security’s team also analyzed that yes, there were several transactions, but almost all of the transactions were directed to a common address. The suspicious address was then recognized as a ‘relay wallet.’ Relay wallet simply means a crypto address which doesn’t store the funds, rather as soon as it receives any funds, it passes it on to the directed address almost immediately. The report said that the relay wallet-

“immediately transfers tokens out to one address whenever it receives them, sans a tiny portion spent on gas.”

The researcher Sentinel Protocol’s cybersecurity pointed out that this kind of pattern often comes from the user wallets on the crypto exchanges. As per reports –

“The next hop on the blockchain saw the ETH go to a wallet dubbed 0xf056f4, identified as belonging to a well-known exchange. A look at the wallet showed it had seen over 37,000 transactions and a balance of well over 10,000 ETH.”

The above information is evidence enough to prove that the wallet belonged to service, despite it being inactive for several months since last year. As per the team, there were more inwards transactions than outward transactions.

Although the wallet can send big amounts in 2,551 ETH denominations, the team deduced that the 0xf056f4 wallet belongs to the crypto exchange- Huobi, based on the ERC-20 token transfers. This made the team confident about the fact that the funds were transferred to Huobi. Based on this, the crypto exchange has been alerted.

Bancor is a firm that offers decentralized services. It got hacked in July of last year. The stolen amount was around 23.5 million worth of Ethereum and ERC-20 tokens, namely 229 of Pundi X’s NPXS tokens. Last year, the approximate rate of these tokens was around 1 million US dollars. The firm’s own BNT tokens were also hacked, which were worth around 10 million US Dollars. When the hack took place, the crypto firm immediately stopped the entire platform’s activity at that time, and the BNT tokens were also frozen. It also contacted other crypto exchanges and firms to tighten up the security around liquidity rules and regulations, since hacking can impact them too.

Bancor, despite being a decentralized platform, made use of centralized systems’ as a first-aid response when the hacking attack took place, by freezing all its tokens and activities. This response by Bancor was criticized at that time.

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