Crypto Trading Firm Wintermute Has Suffered $160 Million Hack

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Crypto trading platform Wintermute has just lost $160 million in a hack which concerns its decentralised finance (DeFi) operation.

This news was confirmed through a tweet from the company’s founder and CEO, Evgeny Gaevoy.

This makes Wintermute the latest firm within the industry to have suffered a hack. A series of tweets by Gaevoy has revealed that the prominent trading firm’s decentralised financial operations have been breached.

He also clarified that the centralised finance and over-the-counter verticals had not been compromised in the hack.

He further stated that Wintermute, which counts Lightspeed Venture Partners, Pantera Capital, and Fidelity’s Avon among other backers, has remained solvent with “twice over that amount in equity left”.

Accompanying the tweets, he also mentioned that if lenders wanted to recall their loans, the trading platform would oblige.

He also added,

If you have a MM agreement with Wintermute, your funds are safe. There will be a disruption in our services today and potentially for the next few days and will get back to normal after.

Wintermute Provides Liquidity Solution To Over 50 Crypto Exchanges

Wintermute is responsible for providing liquidity to over 50 crypto exchanges and trading platforms, which include Binance, Coinbase, Kraken, and FTX.

It also serves decentralised platforms such as Dydx and Uniswap. Wintermute is also an active investor and has backed up startups such as Nomad, HashFlow, and Ondo Finance.

There is still a lack of clarity as Evgeny Gaevoy has not disclosed when exactly the hack took place or even how the perpetrators were able to carry out the hack.

There is also no update regarding the involvement of law enforcement.

“We consider Wintermute’s recent hack as a result of an outdated business framework,” explained Alex Andryunin, CEO at GotBit.io.” One shouldn’t delegate market making services to a company that holds their liquidity on a single wallet, as it will definitely cause such issues. Unfortunately, there are still lots of market making providers who still operate in the old-fashioned, “centralized” even on DEXs. We suppose to think that designated market making is the only possible way that should continue to grow and expand, as such services don’t take control over the client’s funds.”

“In Web3 there’s always an atmosphere of cooperation and assistance, and we’d be glad to provide everyone who take losses from the hack with free support on GotBit,” Andryunin continued.

The Hack Is A “White Hat” Event

The company’s founder and CEO have stated that this hack has been treated as a “white hat” event and even requested that the hacker contacts them.

The hacker’s wallet has been tracked by on-chain sleuth ZachXBT. It has been found that the wallet holds close to $9 million in Ethereum and $38 million in other ERC-20 tokens.

Wintermute has previously experienced another mishap this year when it sent $15 million of Optimism (OP) tokens to the wrong address. The tokens were, however, returned by the recipient.

Wintermute was founded in the year 2017, and it trades billions of dollars across the crypto market daily as it is a liquidity provider to multiple venues. Last week, Wintermute was named the official DeFi market maker for the Tron network.

Related Reading: Number Crypto Scams On YouTube Explodes 335% In First Half Of 2022

Featured image from UnSplash, Chart: TradingView.com

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