Shezmu Recovers Stolen Funds from Hacker
Shezmu, a cryptocurrency lending platform, has successfully recovered nearly $5 million in stolen digital assets through direct negotiations with the hacker responsible. This recovery was based on a mutual agreement to increase the bounty for the hacker.
The Incident
On September 21, Chaofan Shou, co-founder of blockchain analytics firm Fuzzland, identified a breach in Shezmu’s storage vault. Approximately $4.9 million worth of cryptocurrencies were stolen. While it was unclear whether this was a hack or an internal fraud, the loss was significant.
Response and Negotiation
Shezmu confirmed the breach and revealed that one of its ShezmuUSD (ShezUSD) stablecoin vaults had been exploited. The company promptly reached out to the hacker, offering a bounty for the return of the stolen funds with a guarantee of no legal repercussions.
Through an on-chain message, Shezmu requested the return of 90% of the stolen funds within 24 hours. They also made it clear that law enforcement would only be involved if the hacker did not comply.
Hacker’s Demands
The hacker responded by demanding a 20% bounty reward, rather than the initial 10% offered by Shezmu. The company agreed to this higher bounty, and within hours, began receiving the stolen assets. The hacker initially returned 282.18 Ether (ETH) and later added 137 Wrapped Ether (WETH).
Partial Recovery
At the time of writing, not all funds had been recovered. Shezmu advised its investors to minimize their interactions with the protocol’s Oasis vault until further updates.
WazirX’s Struggle to Recover Stolen Funds
In contrast to Shezmu’s success, Indian cryptocurrency exchange WazirX has made no headway in recovering $230 million stolen from its platform 60 days ago. The company has not acknowledged the hack and blames its custodian, Liminal, for the loss. An independent audit by Grant Thornton found no evidence of a cyberattack originating from Liminal’s systems.
Legal Troubles
WazirX is now facing legal action from its customers, including a significant lawsuit from rival exchange CoinSwitch, which is seeking to recover approximately $6.2 million.
Conclusion
While Shezmu’s proactive approach and willingness to negotiate led to a partial recovery of stolen funds, WazirX’s lack of acknowledgment and transparency has resulted in ongoing legal challenges and customer dissatisfaction. The stark contrast between the two cases highlights the importance of swift and transparent responses in the face of cybersecurity breaches in the cryptocurrency world.
