IoTeX predicts a $4.3M loss as analysts investigate the Token Secure event
Decentralized identity protocol IoTeX has confirmed that it is investigating unusual activity related to one of its token vaults after onchain analysts identified a potential security issue.
In a project posted on X on Saturday, the team said it was “working around the clock to assess and contain the situation.” IoTeX added that earlier estimates of potential losses were lower than rumours, and that it had coordinated with major exchanges and security partners to track and block funds linked to the attacker.
“The situation is under control. We will monitor closely and provide regular updates to the community,” the project said.
IoTeX's native token (IOTX) fell following the incident, with its price sliding more than 8% to $0.0049 in 24 hours, according to data from CoinMarketCap.
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According to the analyst, the broken key cost 4.3 million dollars
The response came after onchain investigator Specter said a private key linked to its security may have been compromised.
The onchain sleuth revealed that the wallet was drained of several tokens, including USDC (USDC), USDt (USDT), IoTeX (IOTX) and Bundle Bitcoin (WBTC), with an estimated loss of $4.3 million. The stolen funds were allegedly converted to Ether (ETH), with about 45 ETH converted to Bitcoin.
The analyst published addresses linked to the suspected attacker, along with transaction records showing rapid activity on decentralized exchanges and token exchanges. The move suggested trying to quickly change and move assets through the chain to complicate recovery efforts.
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Most crypto projects never recover from a hack.
According to Cointelegraph, nearly 80% of crypto projects struggle to recover from major hackers, mostly due to mishandled responses rather than immediate financial damage, according to Web3 security leaders. Immunefi CEO Mitchell Amador says many teams are unprepared for breaches, leading to delays in critical first-time decisions and poor communication, which exacerbates losses and undermines consumer confidence.
Even after technical fixes are implemented, the reputational impact can be delayed. Alex Katz, CEO of Kerberus, said serious exploits cost users money, reduce liquidity, and cause long-term reliability damage that projects rarely overcome.
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