DeFi Protocol Sturdy Finance Loses Around $775,000 in ETH in Hack Attack

This attack marks the first major hack incident in the Web3 sector in the last two months.

Written by Radhika Parashar, Edited by Manas Mitul | Updated: 12 June 2023 18:03 IST

DeFi Protocol Sturdy Finance Loses Around $775,000 in ETH in Hack Attack

Photo Credit: Reuters

Crypto hackers stole as much as $3.8 billion last year

Highlights

Sturdy is working on fixing the vulnerability
Sturdy has not disclosed how many users have been affected
No word about the reimbursements to the victims as yet

A hack attack on Sturdy Protocol has reportedly led to the loss of ETH 442 or $774,317 (roughly Rs. 6.3 crore). A DeFi platform founded in 2020, Sturdy Protocol allowed its users to engage in interest-free borrowing as well as high yield lending. On Monday, June 12, cybersecurity firms sounded an alert on social media, bringing this breach into notice. The attacked protocol soon jumped into action to mitigate the risks that could have followed this attack.

A vulnerability in Sturdy's network was exploited in this attack in a way that enabled the hacker(s) to withdraw more funds than usual in such kinds of attacks. The cybercriminal(s) reportedly managed to access and manipulate a defective price oracle leading to the loss of funds.

As per the official Twitter update from Sturdy, they have paused activities on their network. The protocol has also informed users that no more funds are at risk.

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We are aware of the reported exploit of the Sturdy protocol. All markets have been paused; no additional funds are at risk and no user actions are required at this time.

We will be sharing more information as soon as we have it.
— Sturdy :bricks: (@SturdyFinance) June 12, 2023

PeckShield was among the first cyber security firms to have posted an alert about this attack, tagging the Sturdy team to get their immediate attention.

Hi @SturdyFinance, you may want to take a look: https://t.co/XiJppu6Ww3

The issue seems to be related to the price manipulation
— PeckShield Inc. (@peckshield) June 12, 2023

PeckShield has also claimed that the hackers have managed to deposit the stolen funds in scrutinised crypto mixer, Tornado Cash.

As of now, the identity of the miscreant(s) responsible for the hack remain unknown.

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Cyber security firm BlockSec, meanwhile, is also monitoring the situation and posting important updates on its Twitter handle.

2/ The attack tx (https://t.co/XdAhTpE6aS) consists of the following attack steps. pic.twitter.com/EvZhYpWPDO
— BlockSec (@BlockSecTeam) June 12, 2023

Investigation in the case is ongoing and updates remain awaited. This attack marks the first major hack incident in the Web3 sector in the last two months.

Losses incurred due to crypto exploits reportedly dropped by 93 percent in January, as compared to the same month last year, a PeckShield report had said in February.

A total of 24 crypto exploits were recorded by blockchain security firm in January this year. Collectively, these exploits amounted to loss of $8.8 million (roughly Rs. 72 crore). In January 2022 however, the company had estimated the value of crypto funds lost in exploits to be around $120 million (roughly Rs. 980 crore).

The month of April this year turned the tables for the PeckShield report, with two major exploits having made it to the headlines.

While the SushiSwap DeFi protocol had lost $3.3 million (roughly Rs. 27.03 crore) in an exploit, some users of KuCoin exchange collectively lost over $22,000 (roughly Rs. 18 lakh) after the Twitter account of the crypto exchange was briefly hacked in April.

Last year was the worst on record for cryptocurrency heists, with hackers stealing as much as $3.8 billion (nearly Rs. 31,100 crore), led by attackers linked to North Korea who netted more than ever before, a Chainalysis report had claimed in February 2023.

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Further reading: Cryptocurrency, Sturdy Finance, Hack Attack

Radhika Parashar

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Radhika Parashar is a senior correspondent for Gadgets 360. She has been reporting on tech and telecom for the last three years now and will be focussing on writing about all things crypto. Besides this, she is a major sitcom nerd and often replies in Chandler Bing and Michael Scott references. For tips or queries you could reach out to her at RadhikaP@ndtv.com. More