- KiloEx lost $7.4M in a cross-chain exploit.
- Hacker returned $1.4M after ultimatum.
- KiloEx involved Hong Kong police and partners with SlowMist.
KiloEx has become the latest victim to be exploited for $7.4 million in 2021. After being silent for several days, the individual responsible has returned $1.4 million worth of USDT.
Blockchain security firm PeckShield posted on X (formerly Twitter) on 18th April, confirming the return of funds for the exploit, which was linked to a KiloEx. The funds came back and were sent to a KiloEx-controlled address. On April 15, a cross-chain exploit compromised KiloEx, an endemic perpetual trading platform underpinned by YZi Labs, affecting Base, opBNB, and BNB Chain.
KiloEx Issued Hacker a 72-Hour Ultimatum
The exploit was first detected by Cyvers Alerts, which detected a suspicious wallet funded through the privacy protocol Tornado Cash. In the case of the breach, the problem was in the platform’s price oracle system, which allowed the attacker to control the values of ETH/USD. The exploiter leveraged artificially inflated prices to pillage significant funds on many chains. The breakdown of the losses revealed that Base lost $3.3 million, opBNB lost $3.1 million and $1 million was lost on BNB Smart Chain (BSC).
After the attack, KiloEx gave the exploiter a 72-hour ultimatum, and for the rest, it provided a white hat bounty of 10% of the stolen funds in exchange for the safe return of the rest of the assets. The team wrote you a public message: ‘We are watching all your addresses and ready to freeze the stolen funds quickly.’
KiloEx Filed Police Report on April 17
KiloEx was able to file an official report to Hong Kong police on April 17 when an attack occurred without an immediate response. The protocol also enlisted the help of cybersecurity firm SlowMist in the investigation. The team also stated that it intends to publish a full incident report when the investigation proceeds and confirmed that key information had already been shared with law enforcement authorities.
Even though the $1.4 million returned is quite markedly less than the 90 percent threshold specified in KiloEx’s whitehat proposal, the transaction still serves as a potential breakthrough in the recovery efforts. However, KiloEx hasn’t announced that it received the funds nor said if there are active talks with the attacker.
In the meantime, the platform is working hard to reestablish trading functionality and finalize the details of its user compensation process. According to KiloEx, those in open positions will receive positions settled on the pre-attack market, with no forced liquidations as a result of the exploit.
