Bittensor Halts Network Activity After $8 Million Wallet Drains

cryptonews.com:

Bittensor halted its operations on July 3 following a major security breach that led to the theft of over $8 million in cryptocurrencies.

This incident adds to the ongoing security challenges in the crypto industry, where hacks and exploits continue to hinder widespread adoption.

On July 3, Bittensor, one of the largest AI-focused decentralized networks with a market capitalization of $1.6 billion, halted its network activity following a series of wallet drains that resulted in the theft of at least $8 million worth of digital assets.

Bittensor, which connects machine learning models owned by individuals worldwide, initiated the network outage to contain the exploit.

By way of an update, we have contained the attack and put the chain into safe mode (blocks producing but no transactions are permitted).

We’re still mid investigation and are considering all possibilities. Stay tuned.

— Ala (@shibshib89) July 3, 2024

Bittensor co-founder Ala Shaabana announced on X that they have contained the attack and put the chain into safe mode, with blocks producing but no transactions permitted. The team is still investigating and considering all possibilities.

The theft was first identified by pseudonymous on-chain investigator ZachXBT, who announced in a July 3 Telegram message that Bittensor had been halted due to additional thefts earlier that day, potentially resulting from a private key leakage.

Reports indicated that an unknown address, “5FbW,” was exploited to obtain 32,000 Bittensor (TAO) tokens valued at approximately $8 million.

This attack follows a similar incident on June 1, where another wallet was drained of $11.2 million worth of TAO tokens, as reported by ZachXBT.

Following the attack, the price of TAO tokens dropped by 15%.