Is the FTX platform behind its own hack?

The FTX case continues – We have been following the inexorable fall of the FTX trading platform. The situation took a whole different turn following the $400 million hack. However, one question remains: is the FTX platform behind its own hack? Web3 investigators are on the case and their revelations are surprising.

FTX’s Descent into Hell

For more than a week, the FTX exchange platform is on everyone’s lips. Indeed, it is in full decline following a major liquidity crisis, induced by poor management.

This fall was accelerated by the many sordid revelations vis-à-vis FTX. Thus, the platform is singled out for chaotic risk management. To which are added various insider trading rumors and other misappropriations.

For his part, the CEO of FTX Sam Bankman-Fried does not seem to take the matter very seriously. Thus, he published a series of troll-like posts on Twitter. Unacceptable behavior given the seriousness of the events and the colossal losses recorded by FTX users.

As bad news never comes alone, FTX was the target of a major attack. This led to the theft of $400 million in cryptocurrencies.

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Hack FTX: on the trail of the hacker

Transparency is one of the major innovations of blockchain and cryptocurrencies. Thus, anyone can go through the public account book to trace movements of funds.

Not surprisingly, many Web3 investigators have taken to tracking down the hacker’s trail by observing on-chain information.

An inexperienced hacker?

Initially, it was established that the attacker had hacked a cold wallet. In practice, these wallets are supposed to be more secure because they are stored offline. This early information supported the theory ofinside job.

Subsequently, the security audit company Hacken detected several extremely curious manoeuvres. Indeed, the attacker would have tried several times to transit USDT via the TRON blockchain. However, he failed several times because he did not have enough funds to pay the transaction fees in TRX.

To remedy this, he did mistake of the century. Indeed, the attacker transferred 500 TRX from his personal Kraken account, allowing the exchange to obtain its identity. Information that was later confirmed by Nick Percoco, the head of security at Kraken.

Kraken announces that they know the identity of the FTX hacker – Source: Twitter.

The inside job track

Obviously, many Internet users favor the track of theinside job, namely that the hack was carried out by someone at FTX. This theory is notably corroborated by the fact that the targeted wallet is a cold wallet, to which access should be extremely limited.

The inside job theory is gaining momentum.
The inside job theory is gaining momentum.

For its part, Kraken does not wish to provide more information. The latter only revealed that the hacker was an American citizen. For the rest, it will be up to the police to investigate:

Kraken is in contact with law enforcement, and has frozen access to the Kraken account for certain funds that we suspect are associated with FTX-related “fraud, negligence or misconduct”.

Nevertheless, the track of a fake account cannot be ruled out. Indeed, it is common for hackers to use a false identity when creating an account on a centralized platform.

Be that as it may, the inside job track remains solid. Indeed, this takes on its full meaning in view of the latest revelations regarding insider trading between FTX and Alameda Research. Thus, Alameda Research would have stocked up on many tokens before their addition to the FTX platform to take advantage of the upside generated by the listing.

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