Home News The Frozen $280 Million worth of Ether was a Hack not an accident

The Frozen $280 Million worth of Ether was a Hack not an accident

by Harikrishna Mekala

On Tuesday, Parity admitted all of its multi-signature Ethereum containers which each need multiple people to sign-off transactions devised since July 20 were “accidentally” frozen, quite possibly forever locking folks out of their cyber-cash collections. The digital currency stores contained a predicted $280m of Ethereum; 1 ETH coin is worth about $304 right now. The wallet developer indicted a single user who, apparently, involuntarily triggered a software flaw that took the shutters down on roughly 70 crypto-purses worldwide.

That user, remembered as devops199 on GitHub although has since removed their account, claimed they created a buggy wallet and tried to delete it. Thanks to a programming mistake in Parity’s code, that act locked down all wallets formed after July 20, when Parity updated the multi-signature wallet software following a $30m robbery.

One of those now-frozen Ethereum wallets belongs to Cappasity, a star-tup an online marketplace for AR and VR 3D models. It states it had 3,264 ETH in the knackered Parity money store, worth about $1m at modern prices, and isn’t likely to get the funds back anytime soon. Cappasity amassed the Ethereum of punters buying ARtokens, which can be replaced for designs when the souk launches later this year. The biz still has entrance to the Bitcoins it received for ARtokens.

Now Cappasity has claimed the wallet freeze was no accident: someone intentionally triggered the mass lockdown, we’re told, and there’s proof to prove it. By studying devops199’s attempts to obtain and change ownership of ARToken’s and Polkadot’s smart deals, it appears the user was maliciously pushing around, eventually triggering the catastrophic bug in Parity’s software.

“Our internal study has demonstrated that the activities on the part of devops199 were deliberate,” said Cappasity’s founder Kosta Popov in an announcement this week.

“When you are tracking all their actions, you realize that they were prudent… Therefore, we tend to think that it was not an accident. We think that this was a slow hacking. We believe that if the situation is not favorably resolved in the nearest future, talking law enforcement agencies may be the right next step.”

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