An Alleged Ethereum Hacker Gave Back $3 Million and Nobody Knows Why
This is unheard of.
HM. Image: Shutterstock
If a hacker manages to steal millions of dollars worth of cryptocurrency and get away with it, why would they ever give it back?
That's what critics and observers are wondering after a hacker who allegedly stole millions of dollars worth of ether—Ethereum's currency—returned $3 million USD of the stolen funds to the victim, months after it disappeared. Why? Frankly, nobody knows.
In July, Ethereum app company CoinDash launched a much-hyped fundraiser. During the Initial Coin Offering, investors were invited to send ether to a company-owned Ethereum address in return for CoinDash tokens. But, just as the ICO launched, an alleged hacker replaced the CoinDash address on the company's website with one that the hacker controlled. In just a few minutes, victims sent over $7 million USD worth of ether to the fake address. The price of ether increased between mid-July and mid-September, making that pot of stolen funds much more valuable—over $10 million at today's prices.
On Monday, CoinDash announced in a blog post that the alleged hacker returned $3 million worth of the stolen funds, representing about a quarter of the ether that was stolen, to a company account. The transaction is listed on the blockchain, meaning that it is very real. The fake account previously cashed out nearly $130,000 worth of ether, and the Ethereum wallet still contains more than $8 million. This all makes the returned $3 million an immense mystery, even to CoinDash. A successful thief rarely returns their prize out of the goodness of their heart.
The way Alon Muroch, CEO of CoinDash, tells it, he had just stepped off a plane from Kiev on Monday when he got a notification saying that the alleged hacker's address was moving funds. Muroch quickly realized that the funds had been moved back to CoinDash. "We have not been contacted by the hacker, or anyone related to the hacker," he said.
"A hacker steals a lot of money and out of the blue returns some of it…" Muroch trailed off and started to laugh. "It's truly incredible, this industry."
After the alleged hack back in July, CoinDash ensured that everyone who sent ether—even if they sent it to the thief—got their share of tokens. From the company's perspective, everything is square with their investors and the returned $3 million will be used to develop the company's platform, a cross between a trading platform for cryptocurrencies and a social network for the traders.
According to Muroch, an investigation involving Israeli authorities—where the company is based—is ongoing, which should reveal more about this truly strange event.
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