Smart Wallet Loopring Hacked: $5 Million in Crypto Stolen

Bittime - Loopring, a zkEVM protocol built on Ethereum, has disclosed a security breach involving its smart wallet application, which it advertises as the “safest Ethereum wallet.” The attack, which occurred on June 9, resulted in the theft of approximately $5 million worth of cryptocurrency.

Leverage Two-Factor Authentication

The attackers targeted wallets that rely solely on Loopring's official watchdog service for two-factor authentication (2FA). The service allows users to designate trusted entities to recover lost or hacked wallets.

Hacked with Impersonating the Owner

The attacker managed to break into Loopring's 2FA system and impersonate the owner of the vulnerable wallet. By gaining approval from an official supervisor, the attacker bypasses normal security protocols and transfers the victim's digital assets.

Investigation Ongoing

Loopring has acknowledged the attack and is currently working with security experts from Mist to investigate the incident. They have also suspended Guardian services and 2FA functionality while they implement additional security measures. Additionally, Loopring works with law enforcement to track down the perpetrators.

Lessons Learned

This attack highlights the importance of diversifying security measures beyond single points of failure. Although Loopring's Guardian service offers a recovery solution, its reliance on a single authorized entity has proven vulnerable.

Users are advised to explore alternative security options, such as multi-signature wallets, to increase the protection of their cryptocurrency assets.

Impact on Markets

The Loopring hack is a stark reminder of the ongoing threat posed by cybercriminals in the crypto space. The incident has likely eroded investor confidence in Loopring's security practices.

However, the company's quick response and ongoing investigation demonstrate their commitment to rectifying the situation and preventing future attacks.

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To be able to buy crypto assets at over, make sure you have registered and completed identity verification. Apart from that, also make sure that you have sufficient balance by depositing some funds into your wallet.

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