Ethena Labs Domain Registrar Account Compromise

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Ethena Finance Logo/Homepage

Ethena offers a synthetic stablecoin which claims to be the first fully-backed, onchain, scalable, and censorship-resistant form of money. Shortly after announcing an airdrop for season 2, which was to be conducted throught their website, hackers decided to offer an airdrop of their own, through the same website. After hijacking the domain registrar account, they directed it to a nearly identical website. Multiple users connected and had their wallets emptied. The Ethena Labs domain was ultimately restored, and they apparently even kept the same domain registrar. There has been no word located on any assistance for users who were affected.

About Ethena Finance

"ENABLING INTERNET MONEY_ Synthetic Dollar and Internet Native Yield"

"Ethena enables the creation and redemption of a delta-neutral synthetic dollar, USDe, crypto's first fully-backed, onchain, scalable, and censorship-resistant form of money.

The mechanism backing USDe enables the first "Internet Bond" offering a crypto-native, value-accruing, dollar-denominated instrument, derived from staked asset returns (to the extent utilized in backing) and the funding and basis spread available in perpetual and futures markets."

"USDe derives its relative peg stability from executing automated and programmatic delta-neutral hedges with respect to the underlying backing assets.

Hedging the price change risk of the backing asset in the same size minimizes fluctuations in the backing asset price as the change in value of the collateral asset is generally offset by the change in value of the hedge.

This enables the synthetic USD value of the collateral to remain relatively stable in most market conditions."

The Reality

This sections is included if a case involved deception or information that was unknown at the time. Examples include:

• When the service was actually started (if different than the "official story").
• Who actually ran a service and their own personal history.
• How the service was structured behind the scenes. (For example, there was no "trading bot".)
• Details of what audits reported and how vulnerabilities were missed during auditing.

What Happened

The specific events of the loss and how it came about. What actually happened to cause the loss and some of the events leading up to it.

Key Event Timeline - Ethena Labs Domain Registrar Account Compromise

Date	Event	Description
September 18th, 2024 10:29:00 AM MDT	Suspected Phishing Report	The domain of Ethena Labs shows that is has been reported for suspected phishing, according to meta_danm.
September 18th, 2024 10:33:00 AM MDT	PocketUniverse Warning Tweet	PocketUniverse reports the detection of a "frontend hack" on the Ethena labs official website, referencing a transaciton which allows the wallet to be fully drained.
September 18th, 2024 10:38:00 AM MDT	User Reports Getting Hacked	User @meta_danm reports getting hacked through Ethena's website, with a screenshot of some blockchain transactions.
September 18th, 2024 10:59:00 AM MDT	BlockAid Tweet	Blockaid announces the detection of a potential front-end vulnearbility on the Ethena Labs website.
September 18th, 2024 11:00:00 AM MDT	Ethena Labs Announcement	Ethena Labs posts a public announcement about the account compromise. They also simultaneously are apparently seeking a security expert to join their team.
September 18th, 2024 11:57:00 AM MDT	Allegations This Is A Repeat	Twitter user GambleDadby claims that Ethena Labs did the same thing a week earlier but didn't even notify people that the website was down. He provides some evidence publicly. Most responses are from scam recovery services.
September 18th, 2024 1:19:00 PM MDT	Domain Control Regain Announced	Ethana Labs posts an update that they've "worked with the registrar to regain control of our domain and had the phishing domains blocked across various services to protect our users".
September 20th, 2024 12:28:00 AM MDT	Investigation Conclusion Tweet	Ethena Labs posts a conclusion to their investigation where they are working with their registrar and confirm that the domain name is safe. They remind users to be vigilant against phishing attacks.

Technical Details

This section includes specific detailed technical analysis of any security breaches which happened. What specific software vulnerabilities contributed to the problem and how were they exploited?

Total Amount Lost

The total amount lost is unknown.

How much was lost and how was it calculated? If there are conflicting reports, which are accurate and where does the discrepancy lie?

Immediate Reactions

"Ethena Labs posted on X platform that their Ethena domain registrar account was recently compromised. They have taken measures to disable the website until further notice."

"The Ethena domain registrar account was recently compromised and we have taken steps to deactivate the site until further notice.

The protocol is unaffected and funds are safe.

Please do not interact with any site or application purporting to be the Ethena frontend."

Ultimate Outcome

"We've worked with the registrar to regain control of our domain and had the phishing domains blocked across various services to protect our users.

To reiterate, the protocol is not affected and funds are secure.

ethena[.]fi remains the only official domain and we will reinstate the frontend site once we have fully investigated over the next few hours."

"Concluding our investigation:

We have worked closely with our registrar and have secured the http://ethena.fi domain.

No Ethena systems were compromised and the Ethena frontend has been restored. The protocol was not impacted and we are resuming normal operations.

Remember scammers are always chasing you—whether its fake phishing sites or taking over legitimate websites.

Please slow down and always check everything twice before interacting."

Total Amount Recovered

There do not appear to have been any funds recovered in this case.

What funds were recovered? What funds were reimbursed for those affected users?

Ongoing Developments

What parts of this case are still remaining to be concluded?

Individual Prevention Policies

No specific policies for individual prevention have yet been identified in this case.

For the full list of how to protect your funds as an individual, check our Prevention Policies for Individuals guide.

Platform Prevention Policies

Policies for platforms to take to prevent this situation have not yet been selected in this case.

For the full list of how to protect your funds as a financial service, check our Prevention Policies for Platforms guide.

Regulatory Prevention Policies

No specific regulatory policies have yet been identified in this case.

For the full list of regulatory policies that can prevent loss, check our Prevention Policies for Regulators guide.