DeFi Project Known as Wormhole Hit With a Potential $320 Million Hack

(Bloomberg) -- Wormhole, a communication bridge between Solana and other decentralized-finance blockchain networks, said all funds have been restored and the platform is back up after hackers stole about $320 million in cryptocurrency.

The online thieves made away with 120,000 wETH, or so-called wrapped Ether, the project's team said on Twitter Wednesday. On Thursday morning, the team said “all funds have been restored,” without specifying the source of the funding. Earlier, the project pledged to add Ether to ensure the wETH is backed one-for-one. 

The vulnerability has been patched, Wormhole management said on the project's Telegram channel on Thursday, reassuring users that funds are safe. It added an official statement and incident report would be issued in due course. 

The hack is one of the largest thefts from a DeFi protocol, which bill themselves as allowing users to bypass traditional intermediaries to borrow and lend digital assets with the added feature of anonymity. 

“This demonstrates once again that the security of DeFi services has not reached a level that is appropriate for the huge sums being stored within them,” said Tom Robinson, co-founder of blockchain analysis firm Elliptic. “The transparency of the blockchain is allowing attackers to identify and exploit major bugs.”  

Wormhole developers offered the hacker a $10 million bug bounty for exploit details and the return of the funds.

Jump Trading Group announced in August that it bought Certus One, which helped develop Wormhole. Jump has said it is a founding code contributor to Wormhole. Certus One offers infrastructure services for proof-of-stake blockchains and has been an active participant in decentralized networks including Cosmos, Terra, Solana and next-generation Ethereum.

A representative for Jump Trading didn't respond to a request for comment on Wednesday. 

The Wormhole hack adds to a slew of problems for Solana, the blockchain that brags lower transaction fees than main rival Ethereum. Last fall, Solana was down for 17 hours after attacks by trading software bots. Bots also degraded the network's performance recently.

Solana's SOL token is down 11% in the last 24 hours, according to tracker CoinMarketCap.com.      

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