A hacker minted $76 million in eBTC on Echo Protocol through an admin-key exploit, with 955 eBTC still held and part of the funds sent to Tornado Cash.
The hacker has already laundered nearly 5% of the loot through Tornado Cash and is still holding the remaining 955 eBTC. Decentralized finance protocol Echo Protocol was exploited after an attacker minted about 1,000 unauthorized eBTC on the protocol, which is deployed on the Monad blockchain.
“We are currently investigating a security incident impacting the Echo bridge on Monad. All cross-chain transactions remain suspended while the investigation is underway,” Echo Protocol said on Tuesday. This latest exploit comes in a month that has seen at least 12 protocols compromised, including THORChain, Verus Protocol’s Ethereum bridge, Transit Finance, TrustedVolumes and Ekubo.
According to PeckShield, the attacker attempted to launder some of the loot by depositing 45 eBTC worth around $3.45 million into DeFi lending and liquidity management protocol Curvance. The attacker then borrowed 11.3 wrapped Bitcoin worth $868,000 against it, bridged the tokens to Ethereum, swapped them for ETH, and sent 384 ETH worth about $822,000 to the Tornado Cash mixing service. Echo Protocol is a Bitcoin DeFi platform focused on Bitcoin liquidity aggregation, liquid staking, restaking, and yield generation.
It creates unified, liquid BTC assets such as eBTC for users to bridge and deploy in DeFi for additional yield. The protocol is deployed on Monad, a high-performance, layer-1, EVM-compatible blockchain.that it was not a smart contract bug, but an admin private key compromise, and the root cause was “operational, not technical.
” The eBTC contract “worked exactly as designed,” they said, adding that the vulnerabilities included a single signature for the admin role, no timelock, no minting supply cap or rate limit, and no “supply sanity check” by Curvance for the freshly minted collateral.that it was aware of the “anomaly” detected in the Echo eBTC market on Curvance and confirmed that there was no compromise with its own smart contracts. It paused the affected market for investigation. DeFi’s billion-dollar secret: The insiders responsible for hacks
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