$200 Million Crypto Exploitation, Bitcoin Drops Below $23,000, What’s Happening? Crypto Market Review, August 2
Unfortunately, the market positivity is gone as the market loses $30 billion in capitalization
The start of the week was not as smooth as we expected it to be after the massive increase in positivity we saw earlier. First we had a Vasil hard fork postponed, then Ethereum decentralized derivatives trading platforms reported that they may experience some problems after the Merge update. Less than 24 hours ago, the market faced a $200 million hack of Nomad bridge.
Bitcoin is losing ground
Unfortunately, Bitcoin failed to hold above the $23,000 threshold and had already reached a price level of $22,800, which shows that the first cryptocurrency does not have enough purchasing power behind it. The lack of trading volume on BTC caused a reversal from the local high of $24,800.
Fortunately, Bitcoin is still moving in the local uptrend since mid-July, which means that the largest cryptocurrency on the market is still in a local bull market, and market participants should not aim for new lows.
The most likely scenario from a technical point of view right now is another test of the local trend support level which is around the $22,000 price level. At press time, the line has been tested twice in July and ended up rallying to new highs.
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A huge bridge exploitation of 200 million dollars
Another event that disrupted the entire industry is one of the biggest companies we’ve seen in recent months. The Nomad bridge faced a critical problem. More than 40 addresses took cryptocurrency worth around $150 million. White Hat hackers bought $8.2 million and ENS names got about $6 million.
#PeckShieldAlert PeckShield has discovered one of @nomadxyz_ bridge exploit 0xC994…0cf599 transferred ~1205 $ETH into intermediate address 0x7a98…dFa308 and ~2580 $ETH into intermediate address 0x8d5D…121124, and began to launder stolen funds via @TornadoCash pic.twitter.com/lxIZLJaIqr
— PeckShieldAlert (@PeckShieldAlert) 2 August 2022
Such a large exploit affected users from various networks, including Cardano and Ethereum. Some Cardano holders used various Cardano-based assets to obtain madUsdc stablecoin, which was tapped “thanks” to the exploit.
The issue that allowed draining of funds from the bridge was found in the Replica smart contract that marked invalid contract interactions as valid and allowed false messages. Attackers simply copied transactions and drained the bridge.
The problem for most attackers is that on-chain analysts had already tracked and tagged nearly every wallet that participated in the bridge drain. Some ENS addresses had been flagged from the beginning, basically revealing the identity of hackers behind them.
The project management encourages users to become “White Hat” hackers and return funds for a 20% reward, which will be around $200,000 per $1,000,000 stolen.
The crypto market is in the red
The situation in the cryptocurrency market leaves a lot to be desired as the majority of assets lose up to 10% of their value in the last 24 hours. Liquidation volume in the market is almost $100 million in the last 12 hours, and most of the liquidated positions are long orders.
The cryptocurrency market lost more than $30 billion in capitalization in the last 24 hours, showing that the industry has already seen a reversal in sentiment. Sentiment had been overwhelmingly positive considering the number of fundamentally bearish factors that exist in the industry.
