Popular cryptocurrency exchange Kraken has raised alarm about a huge financial exploit. Nick Percoco, the Chief Security Officer of the exchange said Kraken lost numerous crypto assets to an undisclosed research team. In a post on his official X (formerly Twitter) page, Percoco indicated that the exchange interacted with the team after discovering a vulnerability.
As revealed, on June 9, the unknown team notified Kraken that it found an acute security bug. However, the undisclosed so-called security researcher exploited scores of crypto assets from the exchange through the bug. About two accounts relating to the security team are in possession of the stolen funds.
Insight Into the Exploit
After discovering the exploit, the exchange took to X to demand that the “exploiter” should reimburse the missing funds. The Chief Security Officer of Kraken explained how Kraken has tried on several occasions to contact the team and discuss the impact of the bug, including the missing funds.
Despite the numerous attempts, the team failed to replicate the communication efforts. Percoco in the post declared that the situation is not white-hat hacking but “pure exploitation.” Furthermore, he indicated that the exchange is treating the issue as a criminal case and has notified numerous law enforcement agencies about the exploit.
The security expert said it has never had issues with legitimate researchers before now. Additionally, he elucidated how Kraken has been running its bounty program for more than 10 years. The executive emphasized that the team stole the funds from the exchange’s treasury. Hence, Percoco stated that all users’ funds are intact.
Side Note On Kraken
Meanwhile, the exploitation of Kraken’s treasury will further fuel the growing speculation that crypto hacks could be on the rise in 2024. Stolen funds from hacks within the first quarter of the year are valued at $542.7 million. The figures indicate a 42% increase compared to the amount crypto projects lost to attacks during the first half of 2023.
So far, more than 15 projects have suffered different exploitations. The likes of Based Doge, NORIME, BitForex, PlayDapp, Concentric.fi, Abracadabra Finance, and Orbit Chain are among high profile exploitation the crypto sector has suffered in the early stages of the year.
Away from the hack, Kraken has enjoyed somewhat of a steady growth as it is presently ranked the sixth-largest cryptocurrency exchange by trading volume. The exchange has an average weekly of 1.4 million active users. Since its establishment in 2011, Kraken has recorded more than 8 million users.
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