Ethena Finance Discord Server Account Compromise
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Ethena offers a synthetic stablecoin which claims to be the first fully-backed, onchain, scalable, and censorship-resistant form of money. On July 14th, a post on the Discord promised rewards to the Ethena community, regardless of whether or not they held any Ethena. This was a fake offer, due to a compromised moderator account. The hack was pointed out by ZachXBT on Telegram, and eventually the Discord was recovered. It is not clear whether any funds were lose in the breach.[1][2][3][4][5][6][7][8][9][10][11][12][13][14][15][16]
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."
"Rewards live now Reward claims for $ENA have been enabled today. All holders of $USDe, $sUSDe, $ENA, and positions containing either token are eligible for retroactive rewards for their loyalty. Community members with no Ethena holdings are also free to claim."
The Reality
"Ethena's USDe is not the same as a fiat stablecoin like USDC or USDT. USDe is a synthetic dollar, backed with crypto assets and corresponding short futures positions. This means that the risks implicated by interacting with USDe are inherently different. Please refer to our extensive Risks section for more information."
"Ethena is committed to transparency. It is crucial to highlight the risks associated with USDe, the actions taken to mitigate these risks, as well as plans to further manage and ameliorate these risks."
What Happened
"According to on-chain sleuth ZachXBT, the Ethena Discord server has been hacked. Do not click on any links for the time being."
| Date | Event | Description |
|---|---|---|
| July 14th, 2024 7:09:00 AM MDT | First Twitter Mention | The first tweet which NewsInSmol posts is a mention of ZacvhXBT reporting the Discord compromise. |
| July 14th, 2024 7:38:33 AM MDT | PANews Article Published | PANews publishes an article with a basic report and screenshot of the Discord server comromise. |
| July 14th, 2024 7:55:00 AM MDT | Discord Locked Down | A user on Twitter reports that they were very concerned about the messages and tried to report them, however the Discord channel is locked down and they couldn't. |
| July 14th, 2024 8:42:00 AM MDT | Mention Of Hacked Discord | The Discord hack is mentioned for the final time on Twitter. It is unclear if the Discord is still hacked from the tweet. |
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
"PANews July 14th news that according to the link detective ZachXBT channel information, the Ethena Discord server has been hacked and no click links are allowed for now."
"It is entirely possible the @ethena_labs discord has been compromised. Do not click on links until the situation is resolved. (ht to the @zachxbt TG for first post I saw).
Sources associated with the project say one mod was compromised."
"I was very suspicious of these messages and tried to report a scam but it seems the discord is locked down as I’m not able to post any messages."
Ultimate Outcome
What was the end result? Was any investigation done? Were any individuals prosecuted? Was there a lawsuit? Was any tracing done?
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.
References
- ↑ SlowMist Hacked - SlowMist Zone (Accessed Jul 17, 2024)
- ↑ Ethena Discord服务器被攻击，暂时不要点击链接 - PANews (Accessed Jul 17, 2024)
- ↑ Ethena (Accessed Jul 17, 2024)
- ↑ @CampbellJAustin Twitter (Accessed Jul 17, 2024)
- ↑ @NewsInSmol Twitter (Accessed Jul 17, 2024)
- ↑ @parrot_coins Twitter (Accessed Jul 17, 2024)
- ↑ @cryptocrim66608 Twitter (Accessed Jul 17, 2024)
- ↑ @0xCryptoKingz Twitter (Accessed Jul 17, 2024)
- ↑ @Gary_BingX Twitter (Accessed Jul 17, 2024)
- ↑ @ben_tokimi Twitter (Accessed Jul 17, 2024)
- ↑ @CampbellJAustin Twitter (Accessed Jul 17, 2024)
- ↑ @daVinciBot1495 Twitter (Accessed Jul 17, 2024)
- ↑ @Neome_com Twitter (Accessed Jul 17, 2024)
- ↑ @0xDrifter Twitter (Accessed Jul 17, 2024)
- ↑ ZachXBT: Ethena Discord server is down, do not click on the link (Accessed Jul 17, 2024)
- ↑ USDe Overview | Ethena Labs (Accessed Jul 17, 2024)