In a recent development, Cypher Protocol, a decentralized future exchange operating on the Solana blockchain, has effectively safeguarded its platform by successfully freezing more than half of the funds stolen worth of cryptocurrency that was illicitly acquired during a recent security breach.
As of August 18th, as mentioned in the latest update by Cypher on their X (known as Twitter), Cypher Protocol’s team has effectively frozen nearly $600,000 in cryptocurrency, which had been unlawfully taken from various centralized exchanges.
This achievement was facilitated by partnering with numerous independent blockchain investigators. Cypher emphasized that the recovery of these funds hinges on the collaboration of the centralized exchanges involved and the issuance of seizure warrants by law enforcement authorities.
Operating as a decentralized futures exchange, Cypher Protocol offers a lending and borrowing mechanism via primary accounts accomplished by multiple cross-collateralized sub-accounts.
Unfortunately, on August 8th, Cypher became the target of exploitation, leading to a loss of approximately $1 million across a range of cryptocurrency assets.
These assets included USDT, SOL, wETH, and several other altcoins. Consequently, the protocol had to take the step of pausing its smart contracts in response to the incident.
Nevertheless, Cypher extended a white hat bounty of 10%, amounting to approximately $120,000, to the contracted hackers. Regrettably, the hackers did not meet the stipulated deadline for returning the funds.
In response, Cypher formulated a redemption plan and introduced a “socialized losses policy” to allocate the remaining assets to affected users on Tuesday.
