he reported Fantom Foundation attack caused the native token to drop about 3.4 percent to trade around $0.177 on Wednesday.
Fantom Foundation, the developer of a leading layer one (L1) blockchain with a vibrant DeFi ecosystem that has more than $40 million in total value locked (TVL), experienced a network attack that drained some of the employees’ wallets. According to an on-chain analysis compiled by Certik, wallets associated with the Fantom Foundation were drained about $657k worth of Ethereum (ETH) and its native token FTM. Specifically, Certik reported that 20 wallets lost approximately $470k in FTM and 18 different wallets lost attests $187k in Ether.
As of reporting time, the stolen funds have been consolidated in an address holding about 4,501 Ether worth approximately $7 million, hence making the hack a personal attack exploiting weak security designs. Moreover, the Fantom Foundation team has admitted the attack used a vulnerability that was previously unknown to the security team, despite the majority of the wallets not being affected.
“There was a zero-day exploit on Chrome because of that some of Fantom foundation wallets got drained. Fantom losses were in the hundreds of thousands of dollars and we are actively tracking the movements of lost funds,” a Fantom administrator noted.
The Fantom Foundation attacker has been identified as someone very familiar with the DeFi ecosystem, supported by the notable Ether balance. As a result, there is a high chance of the attacker negotiating a big bounty reward with the Fantom Foundation as the investigations continue to help patch the vulnerability.
— Fantom Foundation (@FantomFDN) October 17, 2023
Fantom (FTM) and the Market Outlook
The reported Fantom Foundation attack caused the native token to drop about 3.4 percent to trade around $0.177 on Wednesday. The recent drop just added more pain to a 68 percent drop since late January this year, as the altcoin retested a crucial support level that could either yield a price rebound or further capitulation in the coming few months. Nonetheless, the Fantom ecosystem has grown to a vibrant DeFi ecosystem with more than $329 million in stablecoins market capitalization.
Additionally, notable DeFi platforms from other blockchains including Sushi, Curve DEX, and AAVE V3 have already integrated with the Fantom layer one network. As a result, the recent attack did not cause significant damage that could chase major investors in the near term. Furthermore, Fantom Foundation has over $498 million in market capitalization and over $45 million in the daily average traded volume.
The crypto market has significantly grown into an interconnected ecosystem that is heavily regulated to protect investors from prolific scams and attacks. As a result, the Fantom Foundation attacker faces a challenging time ahead of liquidating the funds without being identified.