The holograph protocol was corrupted by a disgruntled contractor.
An internal investigation revealed that a disgruntled former contractor was responsible for hacking blockchain blockchain platform Holograph.
On June 13, a hacker used the Holograph protocol to acquire 1 billion native Holograph (HLG) tokens worth $14.4 million. As a result, the value of HGL tokens dropped by nearly 80% within nine hours of the exploit – from $0.014 to a low of $0.0029.
According to CoinGecko data, at the time of writing, HGL attempted a sustained recovery to $0.0049 before settling at $0.002887.
Holograph launched an internal investigation with blockchain investigative firm Halborn and released a postmortem of the incident on July 2, highlighting the involvement of a “disgruntled former contractor.” According to Holograph, the former contractor issued $14 million worth of HLG tokens using a proxy wallet.
The hacker then sold the newly minted HLG tokens to crypto investors on the open market, causing the price to plummet.
The former contractor-turned-hacker planned the heist months ago, knowing that they had access to the Holograph Protocol v1 Contracts Manager, which later served as a back door.
Holograph intends to involve law enforcement in the investigation. After confirming the reason, Holograph proceeded to reconnect on the v2 protocol and advised all crypto exchanges to allow HLG deposits and withdrawals.
The protocol will implement a burn scheme to reduce the maximum supply of HLG tokens to 10 billion. In response to a community member's concern about oversupply, Holograph responded:
“Yes, it's just a burning supply to move back to the original schedule.”
The protocol has not yet shared plans for recovery of lost funds and law enforcement procedures in the near future.
Related: Crypto Hacking Drops 54.2% in June, $176M Lost in Month
Holograph has implemented a comprehensive solution including operational risk controls to prevent insider attacks.
On June 3, Bittensor Protocol Bittensor was forced to shut down its network following a series of stolen wallets with at least $8 million worth of digital assets.
Bittensor co-founder Alaa Shabana announced a network shutdown aimed at catching the exploit:
“With an update, we have contained the attack and put the chain into safe mode (bans but no transactions allowed). We are still investigating and considering all options.”
An unknown address “5FbW” has been exploited to obtain 32,000 Bittensor (TAO) tokens worth approximately $8 million at the time of writing.
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