After a hack on a Fantom Foundation wallet last month, the latter has rewarded a security researcher with a $1.7 million bounty. With good reason, the researcher discovered that the compromised wallet had the authorization to mine up to $170 million worth of FTM tokens.
Fantom Foundation pays out $1.7 million bounty
On Monday, the Fantom Foundation revealed that a security researcher had alerted it to a problem last month, which could have led to losses of up to $170 million in FTM tokens.
To understand what happened, we need to go back to October 17, when several of the Foundation’s wallets were compromised:
– Fantom Foundation (@FantomFDN) October 17, 2023
While the equivalent of $550,000 in FTMs may have been stolen, Fantom Foundation teams had indicated that one of the wallets involved had actually been reassigned to an employee, suggesting a targeted attack against his person.
By analyzing the contents of the affected wallets, however, a security researcher discovered that the aforementioned wallet contained an administrator token, enabling its holder to mine FTM for himself on Ethereum via the ERC20 FTM contract.
In recognition of his work, the anonymized security researcher received a $1.7 million bounty :
” The risk was quickly mitigated and, in recognition of his contribution, the Fantom Foundation awarded the researcher a $1.7 million bounty. With the attacker’s access to this wallet, the potential damage could have amounted to $170 million (based on the token price at the time), although this estimate doesn’t take into account the insufficient liquidity of the market to fully absorb the tokens. “
Despite the positive turn of events, several questions can be raised. For example, if it’s curious that a Fantom Foundation wallet can be converted back into a personal wallet, it’s even more curious that this is done while leaving said wallet in possession of a token that can influence the total amount of FTM available on the market.
While the foundation did not clarify these points in its press release, it did congratulate itself on guaranteeing a “secure platform for developers and users alike”.
While the Fantom ecosystem was able to host up to $7.9 billion in total locked value (TVL) at its all-time high (ATH), this same TVL today stands at just $59 million, according to DefiLlama data.
