Stablecoin Seneca recovers $5M after offering hacker 20% bounty

  • The Seneca stablecoin exploit, which resulted in the loss of around $6.4 million worth of Ethereum (ETH), has taken a positive turn as the hacker has decided to return over $5 million to the project.
  • The hacker has been instructed to refund 80% of the stolen assets to an Ethereum address and was allowed to keep 20% of the funds.

OUR TAKE
Following the discovery of a major flaw in Seneca’s stablecoin protocol, a hacker accessed over $6.4 million worth of Ethereum (ETH). Promptly offered a 20% reward, the hacker has agreed to return over $5 million to Seneca. Offering rewards to hackers who agree to return some of the stolen funds may decrease user trust and could lead to even more security breaches.
– Sylvia Shen, BTW Reporter

The hacker, who managed to gain access to approximately $6.4 million worth of Ethereum (ETH) through the Seneca stablecoin exploit, has decided to return more than $5 million to the project. This comes after the hacker was offered a 20% bounty for the returned funds.

Seneca stablecoin protocol attack exposes flaw

Seneca, a decentralised loans and stablecoin platform, has announced a 20% bounty to the hacker who successfully exploited a flaw in the protocol’s smart contract approval system, resulting $6.4 million loss in digital assets.

The stablecoin protocol attack was brought to the attention of many blockchain security organisations on February 28.

Businesses such as CertiK alerted consumers about the vulnerability and advised them to remove their approvals from an Ethereum networks.

Although the losses were first estimated to have been $3 million, it was later discovered that over 1,900 Ether—worth around $6.4 million—had been removed from the exploit.

Also read: Hackers pilfer $440K from fake MicroStrategy airdrop news on X

Seneca pressures hacker to return assets

According to Seneca, it is looking into what happened in collaboration with experts. A $1.2 million reward was also provided for the return of the pilfered money.

Seneca instructed the hacker to refund 80% of the stolen assets to an Ethereum address in an on-chain communication on February 29. The hacker was allowed to keep 20% of the asset.

It asked the hacker to give the money back so there would be no legal consequences. It said, ” Acting promptly is crucial, so we kindly request that you return the funds as soon as possible to avoid any further legal action.”

The hacker gave Seneca’s wallet address back about 1,537 ETH, or roughly $5.3 million, a few hours after Seneca sent the message. The exploiter took Seneca’s 20% incentive and retained 300 ETH, or almost $1 million.

Sylvia-Shen

Sylvia Shen

Sylvia Shen, a news reporter at BTW media dedicated in Fintech and Blockchain. She graduated from University of California, Davis. Send tips to s.shen@btw.media.

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