The Nomad Team Ignored The Vulnerability That Allowed The Breach

nomad-hack

✍️ 4 August, 2022 - 17:21 👤 Editor: Jakub Motyka

  • The Nomad token bridge has been the victim of an attack worth more than 190 million dollars.
  • The vulnerability that led to the exploit was pointed out by Quantstamp months ago.
  • The cryptocurrencies involved in the theft have lost up to 94% of their value since then.

The Nomad token bridge hack is considered the fourth largest attack in the world of cryptocurrencies. On this occasion, the attackers have stolen close to USD 200 million in crypto assets belonging to the bridge contract. This has drawn the attention of users due to the number of accounts involved and their methodology.

A vulnerability in the protocol's smart contracts allowed hundreds of people, in addition to the hacker, to empty Nomad's bridge coffers. Some users involved simply copied the data from the first transaction and changed the destination wallet address to their own. For this reason, the event is referred to within the community as a “decentralized theft”.

What Effects Has The Nomad Bridge Hack Had On The Cryptocurrency Market?

The incident greatly affected the coins of the protocols involved in the Nomad bridge hack. Some of them, such as Charli3 (C3), GeroWallet (GERO), IAGON (IAG), among others, have seen a decrease of up to 94% of its price. In turn, Aave, the Ethereum lending platform, has proposed to close its bridge with Phantom to reduce the risks of its exposure to Nomad.

Even though the Nomad team assured that many users used the exploit to protect stolen funds, this has had a strong impact on its credibility. Especially after it was reported learn of a Quantstamp security audit report from the first week of June, in which they warned of the vulnerability. However, the Nomad team misunderstood the problem and did not take immediate action.

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