Wintermute Crypto Market

The CEO of prominent cryptocurrency market maker Wintermute announced a $160 million loss due to a cyber-attack on its decentralized finance (DeFi) operation. Wintermute’s CEO further said the company is “open” to considering the breach a white hat attack and is willing to have a conversation with the hacker.

Wintermute – A Crypto Market Maker

Wintermute is an algorithmic market maker that trades digital assets such as cryptocurrency. The group is a UK-based entity with headquarters in Cheshire and is supervised by the FCA. Evgeny Gaevoy owns more than 25% but not more than 50% of the company’s shares, according to Companies House.

Wintermute provides liquidity on over 50 trading platforms and exchanges, including Dydx and Uniswap, Binance, Coinbase, FTX, and Kraken. It is also an active investor, having invested in companies such as Nomad, HashFlow, and Ondo Finance. Lightspeed Venture Partners, Pantera Capital, and Fidelity’s Avon are among the company’s investors.

Unizen’s head of research and analytics, Ajay Dhingra, stated, “The nature of the exploit shows that Wintermute’s hot wallet was compromised.” whereas, in the interview, Dhingra said, “The attacker cleverly used the bug in the smart contract.”

“This incident again brings focus on tightening the screws around smart contract security, which is an uncharted territory as of now.”

Evgeny Gaevoy, the company’s founder and CEO of Wintermute, was the most recent victim of cyber-attacks targeting decentralized finance (DeFi), losing nearly $160 million. Evgeny Gaevoy revealed in a series of tweets that hackers targeted the firm’s decentralized finance operations but not its centralized finance or over-the-counter verticals.

According to Etherscan, the Wintermute exploiter received transfers of more than 70 different tokens, including $61,350,986 in USD Coin (USDC), 671 Wrapped Bitcoin (wBTC) worth approximately $13,030,061, and $29,461,533 Tether (USDT). It indicates that USDC has the most tokens. However, neither Gaevoy nor Wintermute specified the date of the hack, how the attackers stole, or whether they notified law enforcement.

Gaevoy Will Handle It Like a White Hat

Gaevoy declared that the platform would classify this as a “white hat” activity and offered a 10% reward for information leading to the hacker. He claims that Wintermute, which is backed by Lightspeed Venture Partners, Pantera Capital, and Fidelity’s Avon, is still solvent and has more than double that amount in equity. He promised lenders that Wintermute would honor their request to return their loans.

According to the CEO, if the lender and Wintermute have an MM agreement, the lender’s money is safe. The services will be disrupted for the next few days. He also stated that there should be no significant selloffs because only two of the 90 assets compromised were worth more than $1 million nominally (and none were worth more than $2.5 million). We will immediately contact the two affected teams.”

Recent Cryptocurrency Attacks

Certik, a cryptocurrency auditing platform, estimated that $1.3 billion was stolen in the DeFi attack last year. Wintermute is the most recent cryptocurrency company to suffer a data breach in recent months, adding to an already long list.

Hackers stole more than $190 million from the Nomad cross-chain transmission medium last month. Axis Infinity’s Ronin Bridge was hacked in April and lost approximately $600 million, while Harmony’s Horizon Bridge was hacked in June and lost $100 million.

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