Holograph recently faced a major setback when a smart contract exploit led to the loss of 1 billion HLG tokens, amounting to approximately $7 million. As a result of this hack, the project’s native HLG token plummeted by 80% in the last 24 hours, dropping to as low as $0.0029 before making a slight recovery to $0.0068.
The hack, which was confirmed by the platform, involved a malicious actor compromising the Holograph Operator Contract and minting the large sum of tokens. Despite efforts to patch the initial exploit and work with exchanges to lock compromised accounts, the team is still in the process of investigating the incident and reaching out to law enforcement.
Blockchain security firm Chyvers tracked some of the stolen funds and discovered that the attacker exchanged the tokens for USDT stablecoin, which was then used to acquire 300 ETH. The hacker further dispersed the funds to various addresses, including those associated with privacy protocols like Tornado Cash and Railgun. However, the exploiter’s address still retains a significant amount of ETH, valued at around $167,000 at present.
According to Matt Casto, a DeFi researcher at CMT Digital, the attacker is believed to be a “rogue dev” who funded the address weeks before the incident, and the address in question was the recipient of the minted token supply. This breach occurred despite the platform’s recent efforts to upgrade its ecosystem to LayerZero V2, aiming to bolster cross-chain security and introduce support for additional chains such as Sei, Blast, Solana, Ton, zkSync, and ZetaChain.
The incident serves as a stark warning about the vulnerabilities present in the blockchain and cryptocurrency space, highlighting the importance of robust security measures and constant vigilance against potential threats. As Holograph navigates the aftermath of this hack and works towards mitigating its impact, the broader crypto community must remain cautious and proactive in safeguarding their assets and investments.