How Stolen Funds from Terraport Ended Up in MEXC and KuCoin

According to reports, CZ tweeted that after reviewing the transaction analysis by the Coin An team, the stolen funds of Terraport were not deposited into Coin An, and it was detected that some of the stolen funds had been deposited into MEXC and KuCoin.

Coin security team: Some of the stolen funds from Terraport have been deposited into MEXC and KuCoin

Introduction

Cryptocurrency theft is not new to the world of blockchain technology. However, it’s always shocking and unfortunate whenever it happens. Recently, Terraport, a decentralized exchange, reported that they had been hacked, and approximately $5.5 million worth of crypto assets had been stolen. CZ, the founder of Binance, tweeted that upon reviewing the transaction analysis by the Coin An team, it was discovered that some of the stolen funds were deposited into MEXC and KuCoin. In this article, we’ll dive into how this happened and what can be done to prevent such incidents in the future.

Terraport Security Breach

Terraport, a decentralized exchange that provides access to liquidity pools in a trustless and non-custodial manner, was hacked on September 22, 2021. Upon realizing the security breach, the Terraport team came forward and announced that the hackers had siphoned off around $5.5 million worth of crypto assets from its smart contract.
The Terraport team released a detailed report on the incident, which helped the Coin An team analyze the transaction data to track the stolen funds. The report reveals that the hackers exploited a vulnerability in Terraport’s smart contracts, enabling them to steal various cryptocurrencies such as Ethereum and Chainlink.

Stolen Funds Traced to MEXC and KuCoin

After tracing the stolen funds, it was discovered that some of the assets were deposited into MEXC and KuCoin. It’s uncertain at this point whether the hackers were successful in converting the stolen assets into fiat currencies or other cryptocurrencies. However, the Terraport team is working closely with the Coin An team, as well as other exchanges such as Binance, to track the flow of the stolen funds, secure them, and prevent further attacks.

Security Measures to Prevent Attacks

Cryptocurrency theft and hacking can be prevented with appropriate security measures.

Smart contracts auditing

Smart contracts are the backbone of blockchain technology, and they execute transactions reliably, without interference from third parties. However, they are not infallible, and vulnerabilities can be exploited, resulting in significant losses. Examining smart contracts for vulnerabilities can prevent attacks, and auditing them regularly could help identify any bugs that may have been missed during the development phase.

Multi-factor authentication

Using multi-factor authentication can make it more difficult for hackers to access accounts. Require users to input a code from a separate source before logging into any account. This makes it much more difficult for a hacker to gain access.

Cold storage

Cold storage is the process of placing cryptocurrencies in an offline wallet, ensuring that they are not accessible unless the holder physically plugs them into a network-connected device. This method is typically more secure than hot storage (an online wallet).

Conclusion

The Terraport security breach and subsequent theft of $5.5 million worth of crypto assets highlight the need for robust security measures in the blockchain technology world. Regular auditing, multi-factor authentication, and cold storage are just a few ways to prevent attacks. It’s also essential to work collaboratively with other exchanges and industry players such as Coin An and Binance to share knowledge and prevent further attacks.

FAQs

Q. Can stolen cryptocurrencies be recovered?

A. It’s uncertain whether the stolen cryptocurrencies from Terraport will be recovered. However, the Terraport team is working closely with other exchanges such as MEXC and KuCoin to track the flow of the stolen funds and secure them.

Q. How can users protect their cryptocurrencies?

A. Multi-factor authentication, cold storage, and smart contract auditing can help users protect their cryptocurrencies from theft.

Q. What can be done to prevent future attacks?

A. The blockchain industry should work collaboratively to prevent future attacks. Regular auditing, sharing knowledge about vulnerabilities, and enforcing robust security measures such as multi-factor authentication and cold storage can help prevent attacks from happening.