In two hours, a token infrastructure platform Hedgey Finance has lost at least $44.7 million worth of digital assets to a security breach. According to an April 19 X post by blockchain security firm Cyvers, the attack happened across two networks; the Ethereum layer 2 Arbitrum (ARB) and Binance Smart Chain.
For the first attack, the malicious attacker took advantage of the Hedgey Token Claim Contract by using a flash loan technique to steal $1.9 million worth of crypto. The unidentified hacker quickly swapped the stolen funds to the DAI stablecoin and then transferred to an external address, according to Cyvers.
Shortly after, they repeated the same exploit on the Arbitrum chain, making away with $42.8 million in the process.
Hedgey Finance Responds
After Cyvers had raised the alarm, Hedgey later confirmed the incident in an X post from the firm’s official account. The post reads partly:
“We are actively working with our auditors and team to understand the attack and stop any ongoing attack. We will share more information as we learn more.”
Despite Hedgey’s response, numerous scam accounts impersonating Hedgey Finance have suddenly sprung up on X. They are attempting to defraud unsuspecting users into thinking that they are the real deal while asking users to request funds through malicious links.
Notably, the hack took place only a few hours before the widely-anticipated Bitcoin halving, which is set to slash block rewards by half.
There's no Call To Action with the ID #1.Crypto Thefts Still Thriving
Meanwhile, on-chain security firm CertiK has noted that crypto thefts are still very much rampant. In its Hack3d report, the firm confirmed that at least 223 crypto hacks happened in the first quarter (Q1) of 2024. Those hacks also resulted in the loss of over $502 million worth, per CertiK.
In comparison, Q1 2024 saw a 54% rise in the total amount lost to crypto theft, considering that only $326 million was reportedly lost in Q1 2023. The report also noted that January was the most active month for the hackers who stole over $193 million worth of crypto in that month alone.
Interestingly, there might be just one positive to the hack report. More than $77.9 million worth of stolen funds were ultimately recovered in Q1 2024.
