EigenLayer 'erroneously transferred' $5.5 million worth of tokens to attacker: statement
Quick Take
- EigenLayer has addressed an incident involving a suspicious wallet selling over $5.5 million worth of its tokens, stating that a ‘malicious attacker’ hijacked the token transfer and made off with the funds.
- Some portion of the sale proceeds has been frozen by law enforcement, according to the protocol’s statement.
Ethereum restaking protocol EigenLayer has addressed Friday's suspicious sale of $5.5 worth of EIGEN tokens, stating that the protocol "erroneously transferred" the tokens to an attacker rather than the intended recipient.
The sale of $5.5 million worth of EigenLayer's tokens on Friday raised suspicions after traders speculated that an insider, perhaps an employee or early investor, may have violated the token lockup period by selling the tokens shortly after trading began last week and less than a year after the May 10, 2024 airdrop date. EigenLayer announced it would investigate the "unapproved selling activity."
Eigenlayer has concluded that "...an email thread involving one investor’s transfer of tokens into custody was compromised by a malicious attacker," according to the protocol's statement on X. "As a result, 1,673,645 EIGEN tokens were erroneously transferred to the attacker’s address," the statement says, at which point the hacker swapped the tokens for stablecoins and transferred the proceeds to centralized exchanges. "We are in contact with these platforms and law enforcement. A portion of the funds have already been frozen," Eigenlayer said.
"There is no known vulnerability in the protocol or token contracts and this compromise was not related to any onchain functionality," Eigenlayer said. Current and former employees are prohibited from staking any EIGEN received from Eigen Labs on EigenLayer until at least Sept. 30, 2025, with the firm implementing a freeze on sales until next year.
The price of EIGEN is up 0.54% to $3.22 over the past twenty-four hours, according to The Block's EIGEN price page, giving the protocol's token a fully-diluted value of $5.4 billion. EigenLayer could not be immediately reached for comment.
Disclaimer: The Block is an independent media outlet that delivers news, research, and data. As of November 2023, Foresight Ventures is a majority investor of The Block. Foresight Ventures invests in other companies in the crypto space. Crypto exchange Bitget is an anchor LP for Foresight Ventures. The Block continues to operate independently to deliver objective, impactful, and timely information about the crypto industry. Here are our current financial disclosures.
© 2024 The Block. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.