Insider at Solana’s Cypher Protocol Admits to Stealing $300K

Solana-based
crypto
trading
protocol
Cypher
has
endured
its
share
of
hacks
and
heists.
But
its
latest
loss
–
of
money
meant
for
down-bad
customers
–
was
an
inside
job.

On
Tuesday,
a
pseudonymous
developer
known
as
Hoak
admitted
to
stealing
hundreds
of
thousands
of
dollars
worth
of
cryptocurrencies
from
Cypher’s
hack
reimbursement
fund.
“I
took
the
funds
and
gambled
them
away,”
Hoak
said
in
a

statement,
blaming
his
activity
on
a
“crippling
gambling
addiction.”

Hoak’s
admission
comes
one
day
after
Cypher’s
founder
Barrett

accused
him
of
systematically
draining
troves
of
valuable
cryptos
from
the
protocol’s
redemption
contract
over
multiple
months,
beginning
in
December.
Citing
on-chain
data,
Barrett
said
Hoak
ultimately
sent
assets
worth
around
$300,000
(at
current
market
prices)
to
Binance,
presumably
to
cash
them
out.

Hoak
broadly
stated
Tuesday
that
“the
allegations
are
true.”
In
a

tweet,
he
said
he
doesn’t
expect
anyone
“to
let
this
go
unpunished.”
Barrett
told
CoinDesk
he
had
sent
information
about
the
heist
and
Hoak’s
true
identity
to
law
enforcement
and
was
following
their
lead.

“This
is
incredibly
saddening
to
me.
I
never
thought
this
would
be
a
possibility,
having
a
core
contributor
who
stayed
on
after
the
exploit
to
try
and
rebuild
the
project
be
the
one
who
rugged
funds
from
the
redemption
contract,”
Barrett
wrote.

Cypher
contributors
created
the
redemption
contract
to
reimburse
customers
who
shouldered
a
$1
million
loss
in
an

exploit
in
August.
Barrett
said
the
team
discovered
the
funds
were
missing
after
one
user
reported
issues
in
claiming
their
redemption.