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April 13, 2021
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Here’s who spent more than $ 5mi on Ethereum fees

Researchers at PeckShield identified who was responsible for the two outrageous fees. And it can be a Ponzi scheme.

Researchers at PeckShield, the blockchain analytical data platform, found the owner of the Ethereum address who, for some reason, paid $ 5.2 million in fees to send just two transactions last week. They identified the owner as a small P2P exchange in South Korea, called Good Cycle, and suggested that it could be operating a Ponzi scheme.

Update: We identified the victim, a small P2P exchange in South Korea called Good Cycle, which appears to be a Ponzi scheme. Our investigations found that their security is extremely weak, for example, because they use HTTP instead of HTTPS, which would easily allow an attack hacker.

PeckShield’s vice president of research, Chiachih Wu, added that they sent a 0.5 ETH transaction to the exchange, which was accepted and sent to the address that paid the two huge transaction fees. This, according to them, demonstrates that the address belongs to the exchange.

The $ 5.2 million Ethereum fees

Last week, two mysterious transactions were made and forced blockchain data companies to verify that their information was not corrupted. While normal transactions on Ethereum are around $ 0.17 each, these two transactions spent each $ 2.6 million in fees. One was made to transfer only $ 100 in Ethereum.

While many think that the first transaction was a bug, the second came to confirm everything. PeckShield was the first to report that this would probably come from a wallet exchange and that it could have been hit by blackmailers.

Ethereum co-founder Vitalik Buterin also tweeted about research.

So millionaire rates can actually be pure blackmail. The theory: hackers gained partial access to the exchange’s key; they cannot withdraw but can send fees without effect at any price of gas. So they threaten to “burn” all funds through fees if they are not paid.

Hence, Alex Manuskin – ZenGo cryptocurrency wallet researcher – posted a reply claiming that blackmail would be unlikely. He believes in the idea that an automated system has crashed and accidentally sent these disordered transaction fees.

In any case, the victim, who now appears to be Good Cycle, did not even attempt to take responsibility for the fees. By the way, they were distributed to miners.

Source: Decrypt

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