The founder of Frex Finance claims that X was involved in the hacking of X’s account

Frex Financial founder Sam Kazemian has accused an insider at X of being responsible for hacking the project's official account.

The June 1 breach caused the decentralized stablecoin protocol behind FRAX USD to lose access to its X account.

Frax Finance Uhu

In a June 3 Telegram post, Kazemian mentioned that Frex Financial Group is “reasonably confident” they have identified the culprit, described by blockchain researcher ZachXBT as a “serial fraudster.”

“We will try everything we can to bring the person to justice,” Kazemian said. He clarified that the breach was not due to any security flaws or phishing attacks that targeted Frex Financial Group. “This was an inside job,” he emphasized.

The incident occurred on June 1, when the Frax Finance X account was hacked. In order to take control, Kazemian quickly contacted his followers on X and asked for help in contacting the platform's customer service. “If anyone has a direct line to X account/customer service please DM me,” he said after the hack.

If anyone has a direct line to X account/customer service please DM me, @fraxfinance X account is compromised and seems to be in X without a password reset or other issues. Please stay safe and don't click any X links!

— Sam Kazemian (¤, ¤) (@samkazemian) May 31, 2024

X typically advises users to change their passwords when account overlap is detected. But Kazemian said the passwords were not compromised and there were no internal security issues at Frax Finance that could have led to the breach. Instead, it pointed to potential social engineering and insider involvement on X.

As of now, the Frax Finance X account remains active, but no new posts have been seen since the hack. So far, neither X nor its CEO, Elon Musk, have made any official comments regarding the breach.

An X user commented on the situation, stressing the need for improved cryptographic authentication features on X to maintain its status as the “home of crypto”.

Insider bribery linked to pump and dump scheme.

This incident at Frax Finance is the latest in a series of hacks targeting X projects, which have been launched by X. In late May, suspected insider actions, a crypto trader known as GCR reported a similar deal for his X account.

“2 months ago, a person connected to Twitter was informed that a bribe had been made to access my account, and security was tightened then. But if X employees took money for admin access, there can be no security,” GCR explained.

According to GCR, the attackers took control of the account with a bribe and used it to promote a pump-and-dump scheme involving ORDI and LUNA2.

1/ An investigation into how the @sol ($CAT) mmcoin team was connected to the @GCRClassic hack last night.

Minutes before the hack, an address tied to them misses $2.3M ORDI and $1M ETHFI on Hyperliquid.

Let's dive in. pic.twitter.com/009BdPBfM1

— ZachXBT (@zachxbt) May 27, 2024

ZachXBT later suggested that the developers of Solana-based meme coin CAT may have been involved in that hack. However, it remains to be seen whether the same group is behind the attack on Frax Finance.