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Binance Suspends Elrond Withdrawal and Deposit Services After Massive Hack

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Investing in Binance

Binance, the world’s largest cryptocurrency exchange by trading volumes, has halted withdrawals and deposits of the Elrond (EGLD) network. The suspension comes amid a major hack on the Elrond network.

Binance suspends Elrond deposits and withdrawals

The recent announcement was made through the official Chinese page of the blockchain on June 8, 2022. According to Binance, the suspension of these services was needed because of the security issues with the Elrond network.

Binance said that the suspension of these functions was implemented on June 6, 2022. Binance has remained in active communication with the Elrond network to resolve the issues surrounding the project and the hack.

The statement by Binance further said that the exchange would resume the suspended deposit and withdrawal services after the Elrond network continues to run effectively while maintaining stability.

The Elrond network suffered from a major attack on June 6, 2022. A Twitter post by Wu Blockchain, a renowned crypto reporter, said that the hackers had successfully stolen EGLD tokens valued at $1.65 million.

After the hackers stole these tokens, they later sold them on the Maiar decentralized exchange (DEX). The sale triggered a 92% decline in EGLD’s value. The Maiar DEX has since been suspended, and the related APIs have been suspended.

A Twitter report said that the Elrond network hack was caused by three new cryptocurrency wallets. The analyst said the three wallets received 800K, 400K, and 450K EGLD tokens. Tokens were deployed to these wallets following a smart contract deployment. However, it remained unclear where these funds originated.

At the time of writing, EGLD was trading at $63. The attack on the protocol has dropped the token’s value by 16.2% during the past week. EGLD currently ranks as one of the top 50 largest cryptocurrencies by market capitalization. EGLD hit an all-time high of $542 seven months ago, which is currently over 88% below this value.

Elrond network hacked

The project was hacked for more than $1.65 million worth of cryptocurrencies. These tokens were targeted on a single exchange, and the dump of these tokens in the market affected the prices.

The operation siphoning these tokens was conducted over several hours. After one hour, a new operation, after the first hack, a new operation was started, and the hacker managed to steal all the stolen tokens within an hour. Unfortunately, it remains unclear how these hackers withdrew this staggering amount of money through a single operation.

Some developers have offered insight into how this hack could have happened. The developers analyzed the event following the vulnerability of the liquidity in the EGLD and the wEGLD smart contracts. The nature of this vulnerability is still unclear, but people believe it could have originated from the exchange or on the network side.

After these funds were stolen, the hackers covered any traces by using new wallet addresses and sending the funds from one network to another. Unfortunately, blockchain transactions tend to be highly traceable, and it is nearly impossible to hide tracks without money mixing tools.

95% of the transactions were in the EGLD/USDC trading pair because the EGLD/UDSC trading pair on the KuCoin cryptocurrency exchange remained the same. The chart did not have any signs of unusual fluctuations.

The DEX API is prevented from outlining the real cause of mining and seeks to return funds or recover losses. If hackers withdraw through the USDC stablecoin, they will fail because the coin has a centralized nature.

To learn more visit our Investing in Elrond guide.

Ali is a freelance writer covering the cryptocurrency markets and the blockchain industry. He has 8 years of experience writing about cryptocurrencies, technology, and trading. His work can be found in various high-profile investment sites including CCN, Capital.com, Bitcoinist, and NewsBTC.

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