Victim Reclaims Assets Following $71 Million ‘Address Poisoning’ Incident – Details of the Event

A victim who became a target of a complex ‘address poisoning’ scheme has managed to reclaim nearly all of the misappropriated funds, totaling an impressive $71 million.

The event involved the victim inadvertently sending wrapped Bitcoin tokens (WBTC) to an assailant who skillfully imitated their wallet address.

Fortunately, through the efforts of blockchain cybersecurity company Match Systems and the exchange Cryptex, the victim’s financial losses have been significantly reduced.

What is Address Poisoning?

Address poisoning, often referred to as dusting attacks, takes place when an attacker bombards the wallet of a high-net-worth individual with transactions from a wallet that closely resembles the victim’s address.

If the victim carelessly copies and pastes a wallet address from one of these unsolicited transactions, a minor error can lead to the transfer of millions of dollars into the hands of the attacker.

Regrettably, this is exactly what occurred in this instance.

While the recovered funds currently total around $66.8 million in U.S. dollars, the slight decrease in value can be linked to the attacker’s conversion of the majority of the stolen WBTC tokens into ether after the theft.

Andrei Kutin, CEO of Match Systems, along with Cryptex, played crucial roles in negotiating with the attacker, ultimately resulting in the successful recovery of the funds, as stated in a press release.

“Currently, the victim has no grievances against the attacker,” the press release states.

Blockchain messaging data indicates that the victim initially sought to reach out to the attacker, even proposing a 10% bounty as an incentive, but received no reply.

However, just two days ago, the attacker unexpectedly initiated contact with the victim.

Detailed information regarding the recovery discussions and the rationale behind the initial rejection of the bounty remains limited.

While multi-million dollar exploits in the cryptocurrency sector continue to be prevalent, there are signs that illegal activities may be decreasing.

Security firm CertiK recently reported that April witnessed the lowest amount of funds lost to scams since March 2021.

It is possible that attackers have become more cautious, particularly in light of the conviction of Avraham Eisenberg on fraud charges related to the Mango Markets exploit.

Eisenberg returned a portion of the stolen funds but still faced legal repercussions.

April Records Lowest Crypto Hack Losses

The cryptocurrency sector saw a significant decline in total losses from hacks and scams in April.

The month recorded the lowest combined losses from crypto-related hacks and scams since 2021, with approximately $25.7 million lost to exploits, hacks, and scams.

More specifically, only $25.7 million was lost in attacks throughout the month, marking the lowest figure since CertiK began monitoring such data in 2021.

Flash loan attacks resulted in $129,000 in losses, with the largest incident causing $55,000 in damages.

This represented the lowest occurrence of flash loan attacks since February 2022, and $4.3 million was lost to exit scams.

As reported, the first quarter of this year has seen $336 million lost to Web3 hackers and fraud, with nearly half of the funds stolen in January alone.

Nonetheless, this figure reflects a 23% decline compared to the first quarter of 2023.

It is also noteworthy that $73,885,000 has been recovered from stolen Web3 capital in seven specific cases.

The post Victim Recovers Funds After $71 Million ‘Address Poisoning’ Attack – Here’s What Happened appeared first on Cryptonews.