The Phantom Foundation will award $1.7 million to prevent a $170 million leak

The Fantom Foundation, a non-profit organization that develops the Fantom blockchain platform, took a major hit after a $550,000 hack in October.

On October 17th, Phantom Foundation suffered a fresh wallet hack, an unknown attacker depleted 1% of Phantom Foundation funds. The Foundation then stopped using some of the affected wallets and assigned them to a Phantom employee, making it a “targeted attack”.

Following the incident, an unnamed security researcher discovered an additional risk associated with the hack and alerted the Phantom Foundation, according to a blog post on November 20. This could allow an attacker to create a portion of Phantom (FTM) on Ethereum.

According to the Phantom Foundation, the vulnerability allowed the hacker to withdraw $170 million using the wallet. The firm, for its part, said that the value of the potential loss depends on the value of the token at the time of the hack, “although this estimate does not take into account the insufficient liquidity of the market to fully absorb the tokens.”

The Phantom Foundation said the vulnerability had been “rapidly reduced,” and the organization awarded the unnamed researcher $1.7 million in recognition of his contributions. The announcement added:

“The Phantom Foundation is committed to maintaining the highest security standards for our platform, and we are grateful to the security researchers who contribute to this effort.”

The Phantom Foundation did not immediately respond to Cointelegraph's request for comment.

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Although the Phantom Foundation lost half a million in an attack a month ago, the Phantom token has risen over the past four weeks. The token has increased in value by 82% since October 17, trading at $0.31 at the time of writing, according to CoinGecko. According to the data, the token increased by 78% in the last year.

Launched in late 2019, the Phantom Network is a blockchain protocol that allows users to build and deploy decentralized applications (DApps). The Phantom Foundation Opera is a permissionless blockchain compatible with the Ethereum virtual machine, which allows users to interact with the Fantom network on MetaMask, the leading self-protecting cryptocurrency wallet.

Phantom's recent $550,000 hack is not the first attack on the Phantom Foundation or its beneficiaries. In the year In July 2023, Phantom suffered a major multi-chain bridge hack, which resulted in the loss of $126 million worth of cryptocurrency. Fantom creator Andre Cronje went on to say that the Fantom team was wrong about Multichain's true level of security as it ceased operations in mid-July 2023.

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