The Heist and Initial Loss
On March 16, the crypto community was abuzz with the news of L3yum’s unfortunate loss. The victim, recognized by their pseudonym L3yum on X (formerly Twitter), faced a significant loss after a hacker compromised their hot wallet seed phrase. In this sophisticated attack, the criminal did not only target Ethereum. They pilfered various assets, including Yuga Labs-related NFTs and other tokens from minor projects. These assets were quickly traded or sold, making immediate recovery seem nearly impossible.
Blacklisted and Halted
However, things took a turn for the better on August 11. In a detailed X thread, L3yum shared a hopeful update: authorities had successfully blacklisted and frozen the hacker’s Ethereum-based USDT address. This intervention was the result of L3yum’s diligent work with the police and a specialized cyber team in their country.
Financial Implications
With the current market rate, 90 ETH amounts to an approximate value of $166,000. The frozen USDT in the blacklisted wallet stands at a value of $107,306. This discrepancy in amounts indicates that, while L3yum may be on the path to a significant recovery, it might not encompass the full value of the stolen funds.
Potential Reimbursement?
Instances in the past offer a shimmer of hope. Historically, when a USDT address faces blacklisting under similar circumstances, Tether has undertaken to burn the blacklisted assets and re-issue an equal amount to the legitimate owner. Most of these actions, it’s essential to note, are usually precipitated by a court order.
L3yum, while optimistic about the outcome, remains unsure about the exact process. They shared in a comment, “From my understanding, the blacklisted funds get burnt. However, this is based on my limited knowledge, so take it with a grain of salt.“
Mystery Remains
The actual method used by the hacker to obtain L3yum’s seed phrase remains a topic of speculation. Some believe it could have been a SIM-swap, an inadvertent iCloud backup of the seed phrase, or L3yum accessing their wallet on multiple devices, thereby exposing their private information.
For now, the community waits and hopes for a positive resolution, and the incident serves as a stark reminder about the importance of robust digital security.
