Fresh on the heels of the recent Poly Network hack which saw over $600 million in cryptocurrency stolen, Neko Network seems to be the next to be struck. This ongoing slew of attacks is the latest in what seems to be targeted efforts to undermine the security of vulnerable Defi tokens. These attacks seem to be ramping up in frequency with the PancakeBunny flash loan attack in May still on people’s lips. The most recent attack on Neko Network saw the hacker make away with over $2 million total in stolen cryptocurrencies divided into 1BTCB, 390,000 BUSD and 2,000,000 USDT.
The hacker has since then exchanged the stolen coins en masse for a total of 6390 BNB of which 2,871 coins have been returned leaving the remainder with the hacker. They have continued to transfer the BNB through an online website called Tornado Cash which helps protect anonymity on the crypto network. Tornado Cash is an Ethereum-based tech solution that allows traders looking to protect their anonymity to do so by breaking the link between sender and receiver on the network. This will make it significantly harder to track the hacker as he transfers the coins between wallets before he can finally exchange them for proper currency. After transferring 100BNB at a time through Tornado Cash there is currently a total of 2020BNB from the initial 3,519 BNB loot.
Defi Attacks Becoming a Significant Problem
As mentioned earlier this is just the latest in a series of attacks aimed at particular Defi systems. The Neko attack was carried out by exploiting a loophole that allowed the hacker to use the system’s lending functionality to make away with stolen funds. This is reminiscent of other attacks carried out by hackers in May of this year of which the most memorable is the PancakeBunny attack. The hacker then exploited the loaning system of the Defi protocol, lending a massive amount of BNB and using it to crash the price of the Bunny token by dumping it on the market causing a drop of about 95% and leaving the hacker in about $3 million profit.
A more recent attack on Defi protocol Poly Network saw yet another hacker steal over $600 million from the network and then proceeding to undermine the network even further by returning it in bits and claiming it was done for fun. In a conversation with the hacker, he claimed he was not interested in the money from the start and only did it to expose a flaw in the network which he hoped would be fixed.
These attacks serve as a call to action for a budding cryptocurrency industry to ramp up security to avoid further attacks and attract potential investors. One such investor, billionaire Mark Cuban was burnt when a token he backed dropped by a massive amount. Decentralised finance is a relatively new venture and these attacks if not stopped in their tracks could result in it being nipped in the bud before it can take off.
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