Socket Protocol Suffers Security Breach Leading to Loss of $3.3 Million
In an official communication dated January 16, the renowned cross-chain protocol Sockets suffered a malicious attack, impacting the loss of a measurable amount. The Socket team lamented that the attackers compromised its cross-chain contracts to heist assets worth approximately $3.3 million.
Following the attack, the Socket team informed crypto investors on their respective social media accounts on the security breach. In the report, the Socket team confirmed to take precautionary steps to prevent the attacker from stealing the remaining amount.
Hackers Compromise Socket Protocol
Shortly after the incident, the Socket team temporarily suspended the operation of all contracts linked to protocol. The halting of the contract’s function aims to prevent the security incident from spreading to the entire protocol.
In an urgent message shared on Socket’s social media platform, the tech company confirmed that it would take preventive measures to address the attack. The probing team noted that the security breach affected the digital wallets that command infinite approvals from the Socket contracts.
Based on the severity of the security incident, the Socket team has stopped all activities on the contracts to proceed with further investigations. After assessing the damages caused by the security breach, the Socket team identified the issue.
Reportedly the Socket security breach attracted the attention of multiple blockchain analytic firms. On X, the famous blockchain analyst Spreekaway reported the matter. After analyzing the incident, Spreekaway noted that the attacker gained control of a token that had earlier been approved on the Socket contract.
Nature of Socket Protocol Security Breach
He noted that hackers used an Ethereum address “..97a5” to launch the multi-million dollar security breach. Based on the damages caused by the security incident, Spreekaway advised the Socket community to block all approval from the Ethereum address under questioning.
In particular, Spreekaway claimed that the compromised Ethereum address was labeled as “Socket: Gateway” on Etherscan. Reacting to the news, an anonymous X user purporting to work with the Socket team urged the troubled customers to revoke the approval of the transaction.
The fake X post contained a malicious link directing the Socket customers to block the approval of transactions. The fake tweet bewildered the X community on how Socket users should address the security incident.
Rise of Security Incidents in the Crypto Industry
In a subsequent X post, the Socket security team confirmed that the customers should do nothing regarding the security breach. They restated that the contracts will be paused to ensure the customer’s funds remain safe during the downtime.
Immediately after posting the tweet, X removed the fake post linked to the Socket security incident. On the X thread, another crypto investor, Ryan S. Adams, expressed concerns about the rise of security concerns in the digital industry.
The investors regretted that the increased security breaches posed a threat to crypto natives. Adams confessed the rise of security incidents has exposed aggressive investors to anxiety and loss of confidence in crypto investments.
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