The alleged breach was reported this week by a blockchain investigator, but remains unconfirmed by DWF Labs.
Crypto investment firm and market maker DWF Labs may have been compromised in September 2022 by a North Korea-linked hacking group known as AppleJeus, according to blockchain security researcher Tanuki42.
The alleged theft, which DWF has yet to publicly confirm, is estimated at more than $44 million, mostly in stablecoins USDC and USDT. Tanuki42’s research, shared in a detailed thread on X on Tuesday, Nov. 4, suggests the breach began on Sept. 22, 2022, when an Ethereum address drained funds over a several-hour period.
Blockchain data attached to the thread shows withdrawals from multiple exchanges to the same address, indicating that private keys and personal details from exchange accounts were likely compromised.
“Despite the draining of funds lasting many hours (0:04:59AM – 5:59:11AM) seemingly no successful attempt was made to stop the drain or save funds,” Tanuki42’s post reads. “There was one even one further draining transaction the following day, 23rd Sep at 0:59:35AM.”
Tanuki42 added that the stolen funds may have been laundered through bridging protocol Ren into Bitcoin, where they mostly remained inactive, though some were recently sent to Bitcoin mixer Mixero. The funds were also reportedly co-mingled with other AppleJeus-related thefts, including of Deribit, Tower Capital, and Radiant, the on-chain investigator reported.
Well-known blockchain sleuth ZachXBT responded to Tanuki42’s thread with the comment “DWF hiding a $44M hack? Cannot say I’m surprised.” Meanwhile, Tanuki42 credited ZachXBT for providing the attached visualization of the alleged exploit from blockchain investigation firm TRM Labs.
Movement of funds in alleged DWF hack. Source: Tanuki42, ZachXBT, TRM LabsIf accurate, the alleged DWF Labs hack represents a major unreported breach, raising questions about market transparency and investor risk. The incident would also underscore how vulnerable even prominent firms remain.
The Defiant has reached out to DWF Labs regarding the potential breach but has not yet heard back by press time.
Most recently, DWF Labs led a $21 million Series B round for modular blockchain platform IOST, along with Rollman Management, per Traxcn data.
Balancer Hack
The alleged compromise came to light just a day after the high-profile Balancer theft, highlighting ongoing risks for both decentralized finance (DeFi) and centralized firms.
Veteran decentralized exchange (DEX) Balancer v2 suffered a major hack resulting in the loss of over $128 million. The losses affected several networks, including Ethereum, Polygon, Base, Arbitrum, Optimism, Sonic, and Berachain.
Harry Donnelly, founder and CEO of Circuit, told The Defiant on Monday that Balancer’s breach is “a serious warning” for the DeFi sector. Other experts, however, noted that hacks remain an inherent risk for investors and institutions participating in the crypto space.
Source: https://thedefiant.io/news/hacks/dwf-labs-exploited-for-usd44m-in-2022-hack-report
