Ethereum Layer-2 Optimism Lost 20 million OP to Hacker
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It was quite pessimistic than optimistic as Optimism, Ethereum's layer-2 protocol lost a whopping sum of $20 million to hacker few days back.
https://twitter.com/optimismPBC/status/1534631771421253638?t=TcWlQj00ukWjr8PmsPDivw&s=19
In response, Wintermute, who partnered with OP to provide liquidity has admitted to an error on its part.
In an open letter addressed to Optimism's community, Wintermute strove to explain its involvement from the Genesis of its collaboration with OP.
In a vindictive attempt, it explained how OP approached the liquidity provider fourth night ago and how it was offered a 20 million loan in OP tokens.
The Error
In the process of receiving the loan, Wintermute claimed that they sent an Ethereum (L1) address which had not been deployed to OP (L2).
Although they claimed that they confirmed 2 test transactions from OP before the original transaction was made.
It was later discovered that the token sent could not be accessed.
In the process of recovery operation that entailed deploying Ethereum (L1) to OP (L2), an attacker took advantage before the process could be completed and now possess 20 million OP tokens in his custody.
Wintermute revealed that the attacker has since sold 1 million tokens and added that selling the rest is like a piece of cake.
A recovery process has been publicly proposed to Op's community.
Wintermute has taken it upon itself to monitor the address in possession of these tokens and has promised to buy back the tokens every time the address sells.
Although, there is a second grant of 20 million OP tokens granted to Wintermute again to continue its work, it is important to put in place certain measures that will prevent such mistakes in future.
The optimism foundation in its address to the community recalled a similar event and has educated the community on provisional measures for protection and prevention.
It says that it is common to mistake L1s with L2s. And once the mistake is made, it is essential to move with speed and alacrity on a recovery mission because you never can tell who is watching the chain like in this unfortunate incident.
Update
It has been brought to notice that the hacker has since returned 17million OP tokens.
He claimed that he did that in good faith. He returned them to Vitalik, co-founder of Ethereum's wallet claiming he has much respect for him and sees him as a mentor.
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