A recent headline that got the entire crypto-community talking was the loss of a whopping $24 million by a cryptocurrency whale due to a phishing attack. This raises many questions about how secure even big players are in an ecosystem that’s widely touted for its robust safety features.
In this unfortunate incident, the large cryptocurrency investor lost his entire balance, including Lido Staked ETH and Rocket Pool ETH due to a phishing attack. The quick yet grandiose operation was completed in just two transactions, with one involving the theft of 9,579 stETH and the other dealing in 4,851 rETH. At the time of the attack, these stolen amounts, valued at $24 million combined, were dutifully reported by the cryptocurrency security firm, Peckshield.
Later, the phisher smartly swapped the stolen assets for 13,785 Ether and 1.64 million Dai tokens. Not stopping there, a significant portion of the Dai stash was quickly transferred into the fully automatic cryptocurrency exchange FixedFloat, thus, further spreading the stolen funds to three more addresses.
However, it must be noted that the investor had enabled token approvals to the scammer by signing “Increase Allowance” transactions. This method, although facilitating ease in your crypto dealings, can enable third parties to spend tokens belonging to a different owner via smart contracts. Therefore, in light of the capable threats they pose, cryptocurrency observers have warned against the risks associated with approving ERC-20 allowances.
Yet, it’s not all gloom and doom on the security front. Many Ethereum liquid staking providers have now begun working on a self-limit rule. This rule caps their ownership to not more than 22% of the Ethereum staking market, hence adding a layer of security to prevent any one entity from amassing a dangerous amount of control.
In a universe as expansive and untamed as Blockchain, securing your digital wealth is of the utmost priority. It’s a constant battle of beats and rhythms where one small misstep can lead to dramatic outcomes. While we can’t disregard the possibilities of phishing attacks and scams in the crypto realm, it’s equally imperative to not lose sight of the security measures and strategies that can significantly reduce such risks. After all, the crypto industry is marked by its stellar comeback stories as much as its dramatic downfalls, and prevention definitely holds the key to shared prosperity.
Source: Cointelegraph
