Details have emerged over yesterday’s Solana attack, and it appears a third-party wallet provider could be to blame.
On August 2, more than 8,000 Solana hot wallets were hacked. The attackers made off with an estimated $8 million in stolen crypto. At the time, Solana recommended users switch to hardware wallets. However, this was little consolation to the victims who lost funds.
On August 4, Solana updated the community after it was discovered that the affected addresses were part of the Slope wallet ecosystem.
Slope is a web-based crypto wallet, mobile app, and browser extension. It allows users to send and receive tokens on the Solana network and integrates with Solana Pay.
After an investigation by developers, ecosystem teams, and security auditors, it appears affected addresses were at one point created, imported, or used in Slope mobile wallet applications. 1/2
— Solana Status (@SolanaStatus) August 3, 2022
Breaking Down the Solana Attack
Solana stated that the details were still unclear. However, private key information was “inadvertently transmitted to an application monitoring service.”
It added that there was no evidence the Solana protocol or its cryptography had been compromised.
Solana co-founder Anatoly Yakovenko advised Slope users to regenerate their seed phrase in a different wallet as soon as possible.
Additionally, Binance CEO Changpeng Zhao echoed the advice. On August 4, he recommended using a new seed phrase and private keys and not importing the compromised wallet. He also said that SOL would be safe on his own exchange.
If you used a Slope wallet (for SOL) in the past, move your funds to a different wallet ASAP. Do not "import" the old wallet. Use a new private key or seed phrase. If you don't know those words mean, send your SOL to @binance. The easy way. https://t.co/t1lYcgaX5z
— CZ 🔶 Binance (@cz_binance) August 3, 2022
One researcher claimed that Slope wallets did not send seed phrases to external partners. He added that they may have logged them on their own centralized servers.
Slope issued a letter to its customers stating that it had a hypothesis about the breach but could not confirm anything yet. “We feel the community’s pain, and we were not immune. Many of our own staff and founders’ wallets were drained,” it said.
It is the second high-profile hack this week. On the same day, the Nomad cross-chain bridge was attacked. It lost all of its $190 million collateral in the exploit.
SOL Price Outlook
Solana prices took a hit as news of the wallet hack broke. SOL tumbled almost 10% to bottom out at $38.08 on August 3. Nevertheless, the token has recovered marginally with a 2.5% gain on the day. As a result, SOL was trading at $38.85 at the time of writing.
SOL, however, has crashed a painful 85% from its November all-time high. Furthermore, the network has suffered several outages this year, and its centralization has been questioned.
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