Yahoo Finance Facing the Music: What Did IOTA Think of the $4 Million Heist?
Although the exact number of users affected and the amount of money is unknown, preliminary reports state that the missing funds amount to a whopping g $4 million.
At the same time that IOTA tokens were being drained from the wallets of affected users, a DDoS attack was reportedly enacted on some of the IOTA network full nodes. Corrective measures were immediately taken and the site that was allegedly responsible for the larceny, iotaseed.io, has been taken offline.
After the hack, the founders bared their hearts out and their reactions to the hack. On being asked whether the IOTA network was compromised, IOTA founder David Sønstebø said, “The IOTA network itself, the IOTA technology, nothing was compromised. No one was actually hacked, because of course hacking means that someone was able to go into your system through some means, like forcing through a loophole, or finds a bug in your coding. That did not happen. There was no actual hacking. It’s just important not to use that kind of terminology, even though that is what’s being thrown around. People like the word “hack”.
“What actually happened was a lot of unfortunate users were generating their unique seed (which is what you derive your password from) from a false website, a phishing website. It was meticulously crafted in such a way that it ended up being at the top of a google search for IOTA seed generator, it was the first thing listed in the ads.”
It is fairly easy to create an IOTA wallet. Users need to create an 81-character long seed, which takes time and effort. However, there is also an option of using an online seed generator, which ultimately resulted in this avoidable mishap. Seeds give access to your private key and this is something the IOTA founders had been completely against. However, people who chose convenience over security lived to regret it.
Sønstebø said, “We at IOTA Foundation, had no clue of this website (the errant website where the hack took place). Although we haven’t linked to it, some of our common members had linked to it. The website had been crafted in such a way, that users did not feel the need to be paranoid about it. Going forward, it is wiser to be paranoid, especially when it comes to your hard earned money.”
The author is an editor at crypto-news.in . Crypto-news.in is the largest website in India that is dedicated to purely crypto and blockchain news.
This article was originally posted on FX Empire
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