FTX CEO Sam Bankman-Fried stressed that this compensation should not serve as a precedent and that there will be no further compensation in the future.
Cryptocurrency exchange FTX has decided to pay $6 million in compensation to the victims of a phishing scam that allowed hackers to carry out unauthorized transactions from the accounts of some exchange users.
FTX founder and CEO Sam Bankman-Fried has published an extensive Twitter thread in which he explains that the exchange has no obligation (nor intention) to compensate users who have fallen for a phishing scam due to fake versions of other companies in the sector. However, in this case, they have decided to make an exception.
Bankman-Fired explains that this is something unique and that FTX will not repeat such actions in the future. The CEO has stressed in his Twitter thread that should not be “treated as a precedent” and that the exchange will only refund to FTX users' accounts.
What happened to FTX accounts?
In the recent phishing attack, the attackers They obtained the keys to the application programming interface (API) from users' accounts, via 3Commas, a provider of automated cryptocurrency bots, allowing them to conduct unauthorized transactions with their accounts on the exchange.
On October 21, 3Commas issued a security alert after identifying that certain FTX API keys were being used to carry out unauthorized operations for DMG cryptocurrency trading pairs.
3Commas and FTX conducted a joint investigation, using reports of unauthorized transactions and identified that the hackers had used new 3Commas accounts to conduct transactions with DMG. The investigation also concluded that API keys had been taken outside the 3Commas platform.
The two platforms discovered several scam websites impersonating 3Commas to spoof API keys while users linked their FTX accounts. The API keys were then used API keys from FTX to conduct unauthorized DMG transactions.
3Commas also discovered that hackers were using browser extensions and malware to steal users' API keys.
Sam Bankman-Fried and cyber attacks
On October 19, Sam Bankman-Fried published a controversial article on crypto regulations that included a proposal he called the “5-5 standard,” in which hackers are allowed to keep $5 million or 5% of what they have stolen, whichever is the lesser amount.
In fact, in his Twitter thread about compensation, the CEO begs the hacker to return 95% (about $5,7 million) within the next 24 hours and if he does, “will be acquitted” of everything.
In this sense, the month of October 2022 has been baptized by the crypto community as “hacktober”, as Chainalysis data shows that it has been the month with the highest hacker activity, with 125 attacks since the month began.
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