After nearly 2 million EOS tokens were thought to be lost to a hacker, a thorough investigation and recovery process led to the confiscation of the assets.
The incident began on May 6 of the previous year, requiring a protocol upgrade, multisig proposal, and approval from a Majority of Block Producers (BPs) for resolution.
PayCash, an EOS project, faced a daunting challenge when it discovered the loss of approximately $1.8 million. However, EOS operates differently, with a dedicated assets recovery team known as Recover+ (R+) stepping in to address on-chain crimes.
The recovery process was complex, spanning 10 months, and involved various technical and procedural hurdles with 6,000 hacker-controlled wallets. Notably, the hacker moved the stolen funds to the EOS EVM chain, which wasn’t capable of supporting asset retrieval. An upgrade to the EOS EVM in September facilitated the recovery efforts.
Ultimately, the PayCash team submitted a solution in January and demonstrated its effectiveness on the Jungle testnet.
According to a press release with The Crypto Times, with support from EOS engineers and approval from Block Producers in February, the assets were successfully restored.
While many DeFi exploits go unresolved, EOS’s framework, despite being reliant on BP approval, provides a mechanism for asset recovery in certain cases.
In 2023, DeFi exploits incurred losses of $1.8 billion, highlighting a rising trend despite a decrease from 2022. Most hacks result in unrecoverable assets, often obscured through mixers like Tornado Cash. EOS stands out with a mechanism allowing asset recovery through majority approval of BPs.
The Recover+ team went to great lengths to regain authority over the funds stored in 6,000 wallets on the EOS EVM. Despite the challenges, they ultimately succeeded, prompting PayCash to issue an open letter, which concluded:
“As a sign of our appreciation and commitment to creating a more secure blockchain environment, we commit to donate 5% of all recovered funds to further support and develop the Recover+ project.”
This event underscores blockchain risks, emphasizing the rarity of such resources and the importance of initiatives like Recover+ in fortifying security and safeguarding communities from threats.
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