EigenLayer Team Mistakenly Transfers $5.5 Million Worth of EIGEN Coins to Hackers?

Bittime - EigenLayer, an Ethereum restaking protocol, acknowledged an error in the transfer of tokens worth $5.5 million (around IDR 85.8 billion). The number of tokens was accidentally transferred to the hacker. 

This incident occurred last Friday and immediately raised suspicion among investors regarding the sale of the EIGEN token.

EIGEN Token Speculation among Traders

This suspicious sale of EIGEN tokens immediately sparked speculation among traders. They suspect that the incident involved an insider, possibly an employee or early investor, who may have violated the token lockup period. 

Read also: EigenLayer Price Skyrockets, Traders Do Not Doubt the $5.5 Million Scandal and Justin Sun's Selling Action

This is because the tokens were sold shortly after trading started last week and less than a year after the airdrop date, which was on May 10, 2024. Seeing this suspicious situation, EigenLayer immediately announced that they would investigate the unauthorized sales activity.

EigenLayer Explanation

In a statement delivered via the X social media platform, EigenLayer explained that this incident stemmed from a series of emails that were compromised by hackers. The email involved a token transfer request from one of the investors for safekeeping in a custodian. 

As a result, 1,673,645 EIGEN tokens were mistakenly transferred to the hacker's address. After receiving the tokens, the hacker quickly exchanged them for stablecoins and then transferred the proceeds to several centralized exchanges.

"We are coordinating with the relevant platforms and legal authorities to handle this case. Part of the stolen funds have been frozen," EigenLayer said in a statement.

EigenLayer also confirmed that this incident was not caused by a vulnerability in their protocol or token contract. There was no weakness in the on-chain functionality that caused this hack. 

"This compromise is purely related to the transfer process that occurs outside the network (off-chain)," they added. 

EigenLayer Additional Policies 

To minimize similar incidents, EigenLayer has implemented additional policies for employees and former employees. Where, they are prohibited from staking the EIGEN tokens they receive from Eigen Labs on the EigenLayer platform. 

This prohibition is valid until at least September 30, 2025. Token sales are also frozen until next year to maintain stability.

Read also: EigenLayer Token (EIGEN): Everything You Need to Know

Since this incident was revealed, the price of the EIGEN token has actually increased slightly, namely by 0.54%, to $3.22 (around Rp. 50,232) in the last twenty-four hours. 

Based on data presented by the EIGEN price page on Coingecko, the total value of the EIGEN token (fully-diluted value) reached $5.7 billion (around Rp. 89.4 trillion).

This incident is in the spotlight of investors and market players who are increasingly wary of the security of their digital assets. The world of cryptocurrency does have high risks, including the risk of hacking involving security gaps, both technical and human weaknesses. 

This incident involving EigenLayer is once again a reminder of the importance of ensuring security not only on the on-chain protocol side, but also in all aspects related to overall platform operations.

How to Buy Crypto on Bittime

Want to trade sell buy Bitcoins and crypto investment easily? Bittime is here to help! As an Indonesian crypto exchange officially registered with Bappebti, Bittime ensures every transaction is safe and fast.

Start with registration and identity verification, then make a minimum deposit of IDR 10,000. After that, you can immediately buy your favorite digital assets!

Check the exchange rate BTC to IDR, ETH to IDR, SOL to IDR and other crypto assets to find out today's crypto market trends in real-time on Bittime.