Recently there was a Poly Network hack, where the hackers were successful in cracking the Poly Network and making off with digital currency that is worth $613 million. To date, this is the biggest heist in digital currency. Let us have a look at the Poly Network hack explained.
What Is Poly Network?
The Poly Network is a Decentralized Finance (DeFi) platform that enables users to swap tokens across varied blockchains availing peer to peer networking.
A system of DeFi facilitates this by not depending on middlemen or intermediaries. They enable people to lend, borrow funds, exchange, earn interest, speculate on the market, and trade virtual currencies.
The system disables intermediaries via the use of Smart Contracts. A Smart Contract is a transaction protocol formulated and programmed to operate legal events during the transaction time. This code looks after things such as repayments, liquidations, and loans.
According to a report, as of January 2021, nearly $20.5 billion digital currency was invested in Decentralized Finance around the globe.
The Real Poly Network Hack
A Smart Contract is used by Poly Network to distribute tokens among blockchain that have been coded with information on how to transfer.
Kelvin Fichter, the programmer of Ethereum has put forth a detailed analysis on Poly Network hack Twitter. According to Fichter, the flaw lies in a code in a Smart Contract that was called “EthCrossChainManager” by the users of Poly Network. The hacker was successful in modifying a list of public keys that are required to authenticate data from transfers.
What Happened Next?
Hackers who were involved behind the biggest cryptocurrency heist have now have returned closely all of the $600 million that they stole. This was said by the Poly Network digital currency platform who was attacked last week.
The platform was little renowned before the heist on Tuesday, asserting that hacker as a “White hat” on Twitter. They referred to ethical hackers who generally focus on exposing the vulnerabilities of the cyber world upon funds return.
The Poly Network platform further said that their funds were transferred to a “multi signature wallet” that is controlled by both the hacker and the platform. The platform on Twitter said,
“The repayment process has not yet been completed. To ensure the safe recovery of user assets, we hope to maintain communication with Mr. White Hat and convey accurate information to the public.”
An individual claiming to have committed the Poly Network hack asserted that Poly Network provided him a $5000,000 bounty against the assets that were stolen and even assured him that he would not be accountable for this incident.
Poly Network that enables users to swap or transfer tokens across various blockchains on Tuesday announced that they have been hit by cyber heists and they request the culprits to return the funds that they have stolen. Poly Network hacker identity is still anonymous.
On Wednesday the hackers began to return the stolen coins, which led some blockchain analysts to evaluate that they have found it difficult to use so much digital currency at the same time.
Later on Wednesday, the hackers said in a digital message that they did this attack “for fun” and wished to “expose the vulnerability” before other unethical hackers could exploit it and they “always” had the plan to return the token.
However, at $600 million the Poly Network hack far outstripped the record of criminal loss of $474 million that was recorded by the full Decentralized Finance (DeFi) sector from January to July as recorded by Cipher Tree which is a crypto intelligence company.
According to crypto experts, the hack portrays the risks that prevail in mostly DeFi sectors that are unregulated. Decentralized Finance enables the users to lead transactions usually in digital currency without any traditional gatekeeper such as exchanges or banks.