Solana and Nomad attack: why crypto enthusiasts are worried

Solana and Nomad attack: why crypto enthusiasts are worried

Two severe crypto hacks in a week amounting to millions in losses  – Nomad, which has become the target of attack after hackers stole almost $200 million in digital assets, and Solana where 7,000 wallets had been drained of millions of dollars worth of Solana and USD Coin (USDC) cryptocurrencies in a major internet attack.

Solana hack continues to create noise in the cryptocurrency world. Solana has been one of the most trustworthy and was referred to as the ‘Ethereum Killer’. Despite that, on Tuesday, it was targeted. Users reported about their funds getting drained without their knowledge from their “hot” wallets, including Phantom, Slope, and TrustWallet.

Solana, on its Twitter handle, wrote:

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.

This exploit was isolated to one wallet on Solana, and hardware wallets used by Slope remain secure. While the details of exactly how this occurred are still under investigation, but private key information was inadvertently transmitted to an application monitoring service.

There is no evidence the Solana protocol or its cryptography was compromised.

Solana’s price fell by roughly 10% to $38.28 level on Wednesday as a result of the attack. However, according to data from coinmarketcap, volumes increased by 75% as tokens worth $1.91 billion were traded in the previous day.

The broad hack on Solana wallets, according to PeckShield Alert, blockchain security and data analytics startup, was probably caused by the “supply chain issue,” which was exploited to steal user keys from wallets. It further stated that the loss is anticipated to be $8 million.

Sathvik Vishwanath Co-Founder, CEO Unocoin said, “Solana is a blockchain with its own token that works as the gas to confirm the transactions on that blockchain, witnessing numerous hack attempts on the wallets supporting this token.”

The attack on Solana was timed to coincide with a “chaotic” attack on cryptocurrency service Nomad, in which hackers stole nearly $200 million in digital funds in a matter of hours.

Earlier, Nomad, a Cross-chain messaging protocol, acknowledged that about $190 million had been taken from it after a hacker infiltrated its system. 

These incidents have raised the ‘trust issue’ in the new Web 3.0 protocols and applications. When DeFI and DApps are engaged in innovation to make their services available to more people, attacks like these play the spoilsport. Cyberthreat has been rampant these days, and with crypto, which is decentralised and supposed to be more secure, such news is demotivating the crypto enthusiasts. Nonetheless, web 3 is in its early days, and with time, the safety issue might get minimised, if not fully resolved,

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