Fantom Foundation Confirms A $550,000 Loss in A $7 Million Attack

The Fantom Foundation confirmed that it and its employees collectively lost millions of dollars worth of crypto in an attack on Oct. 17.
Fantom Foundation Confirms A $550,000 Loss in A $7 Million Attack
Fantom Foundation Confirms A $550,000 Loss in A $7 Million Attack

Fantom Foundation, the inventor of the Fantom blockchain network, has revealed that it was a victim of a recent attack, but that the actual loss was roughly $550,000, rather than the $7 million initially claimed.

Fantom stated on October 17th that while one of its wallets was compromised, over 99% of the foundation’s cash remained unaffected. The vast bulk of the stolen cryptocurrency belongs to other Fantom customers.

According to early estimates from blockchain security specialists, about $7 million was stolen from wallets ostensibly linked to the organization.

However, Fantom confirmed that some of the compromised wallets had already been transferred from the foundation to staff after being mislabeled by blockchain explorers. Only one wallet still had foundation assets in it.

The team is still looking into the incident to figure out how the wallets were accessed. The theft only affected the Fantom Foundation, not the core Fantom network, which includes $45 million in DeFi assets.

After discovering unusual transactions from purported Fantom Foundation wallets, on-chain detective ZachXBT sounded the alarm about a possible attack.

However, Fantom pointed out that the analysis overlooked details such as wallet ownership. Wallet labels, unlike monitoring services, might become out of current as assets change hands.

By publishing the $7 million sum ahead of time, the publications created a short panic and spread misinformation. The incident underscores the difficulties of interpreting blockchain data in real-time to distinguish complicated on-chain events.

Despite the fact that the real loss was closer to $500,000, the Foundation is taking steps to strengthen security across all related accounts. Strong controls and monitoring are especially important for blockchain networks that handle valuable cryptocurrency deposits like Fantom.

This vulnerability was directed at Fantom, not a protocol running on top of their network. However, prior compromises of Fantom-powered DeFi devices raise worries about security procedures within its decentralized ecosystem.

Following the first revelation of the hack, Fantom’s native FTM token dipped 6%, but has since rebounded. The swift correction implies that investors were relieved that the harm was not as serious as initially depicted.

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