Is Bittensor safe? Network Suspended After $8 Million Disappears In Security Breach
The world of cryptocurrency took another blow this week as Bittensor, a prominent project focused on AI, was forced to suspend its network after a series of wallet hacks. Investigators suspect that private key leaks may be to blame, raising concerns about the security of the entire crypto ecosystem.
On July 3, Bittensor founder Ala Shaabana announced the shutdown of the network in a social media post. The big move came after attackers mined at least $8 million worth of TAO, Bittensor’s native token. The incident follows a similar heist about a month ago, where a wallet bleed resulted in the loss of $11 million.
In the update method, we contained the attack and put the chain in safe mode (blocks generated but no transactions allowed).
We are still investigating and considering all possibilities. Stay tuned.
— Ala (@shibshib89) July 3, 2024
They are still investigating and considering everything that may have happened, Shaabana revealed, highlighting ongoing efforts to identify the perpetrator and prevent future violations. The Bittensor team immediately puts the network into “safe mode,” allowing block creation but halting all transactions to contain potential exploits.
Before the shutdown of the Bittensor network, the alarm was first raised by ZachXBT, an anonymous on-chain investigator with a keen eye for crypto shenanigans. Through his Telegram channel, ZachXBT raised the alarm about the suspicious activity, which eventually led to the suspension of the network.
According to a Telegram report by blockchain security expert, ZachXBT was attacked by the BitTensor (TAO) wallet due to a private key leak. Previously, WooBlockchain reported that the BitTensor Foundation was investigating several attacks on BitTensor wallets, which led to …
– BitcoinWorld Media (@ItsBitcoinWorld) July 3, 2024
TAO $11 million wallet theft. Source: ZachXBT
From Smart Contracts to Soft Keys: Shift Hackers’ Targets
While the initial focus of crypto security concerns focused on vulnerabilities within smart contracts – automated code on blockchains – the tide appears to be turning. According to the “Crypto HackHub 2024” report by Merkle Science, a crypto risk intelligence platform, private key leakage has surpassed smart contract exploitation as the leading cause of theft of digital assets in 2023. More than 55% of stolen funds were lost due to compromised private keys. , which highlights a change in criminals’ tactics.
AI Dreams Still Catching: Bittensor’s reputation is tarnished
Bittensor, which boasts a market capitalization of $1.6 billion, is one of the largest blockchain projects focused on artificial intelligence. It aims to create a decentralized network where machine learning models from different owners can collaborate and share resources. This vision of excellence depends on a secure and reliable environment.
TAO down in the last 24 hours. Source: Coingecko
The recent security breach has undoubtedly cast a shadow over Bittensor’s reputation. Investors reacted quickly, with TAO token prices experiencing a 14% drop after the attack. While some recovery occurred after Bittensor announced mitigation measures, regaining user trust will be an uphill battle.
Featured image from TechHQ, chart from TradingView
