Cryptocurrency market maker Wintermute loses $160M in DeFi hack - SiliconANGLE

The major cryptocurrency market maker Wintermute Trading Ltd. said today that its decentralized finance unit was hacked for approximately $160 million; its centralized trades and over-the-counter services remain unaffected.

The company’s founder and Chief Executive Evgeny Gaevoy announced the hack on Twitter in a brief statement noting that the company is still solvent, with twice the amount of the theft and that customer funds are safe. However, there may be a disruption in services over the next few days.

We’ve been hacked for about $160M in our defi operations. Cefi and OTC operations are not affected

— wishful cynic (@EvgenyGaevoy) September 20, 2022

Decentralized finance, also called DeFi, refers to peer-to-peer financial transactions executed on public blockchains using crypto assets that eschew centralized middlemen such as banks by allowing two parties to trade directly with smart contracts, which are self-executing software contracts.

Wintermute claims to be one of the largest crypto markets in the world and uses its platform to provide liquidity across more than 50 exchanges and trading platforms. It does so by offering services within DeFi, centralized finance and over-the-counter trading.

Evengy added that 90 assets were hacked in the attack and “only two have been notional over $1 million (and none more than $2.5M), so there shouldn’t be a major selloff of any sort.”

He also said that at this point the hack is also being treated as a potential “white hat” hack and asked the hacker to get in touch. This means that if the assets are returned, there may be a reward bounty in store. This is not an uncommon way for exchanges and other organizations to recover their stolen funds by offering a reward to the hacker either as a monetary bounty or a job.

Self-proclaimed “crypto sleuth” ZachXBT, who is known for long-form investigations of hacks, posted his own tweet thread about the hack, claiming to identify the hacker’s Ethereum wallet address. Currently, it appears to contain $47.8 million, with the remaining $114.3 million in funds appearing to have been deposited into Curve Finance’s stablecoin pool.

Wintermute did not reveal any details about the investigation into the nature of the hack.