Cryptocurrency-Related Bug Bounties Have Netted Hackers Nearly $900,000 This Year

Cryptocurrency-related bug bounty programs have seemingly been extremely profitable for hackers this year, as stats from breach disclosure platform HackerOne show they’ve netted them $878,000.

According to The Next Web, blockchain companies have received “at least” 3,000 vulnerability reports this year, and data compiled in mid-December shows $878,000 have been awarded in bug bounties so far this year. In August, the figure was at $600,000.

Speaking to the publication a HackerOne spokesperson revealed that “nearly” 4% of all bug bounties awarded on the platform this year came from blockchain and cryptocurrency-related companies. These, it noted, give hackers better compensation when compared to other industries.

The average bounty for all blockchain companies in 2018 was $1490, that is higher than the Q4 platform average of around $900. One of the top paid crypto hackers earned 7X the median software engineer salary in their country respectively.

HackerOne reportedly added that there are 64 crypto-related companies on its platform, a number dwarfed by the more than 2,000 companies the cryptocurrency ecosystem already has in it. This, The Next Web notes,  means the “real number of vulnerabilities is likely significantly higher.”

Out of the nearly $900,000 awarded to hackers this year, Block.one, the company behind EOS, awarded over $530,000, accounting for more than 60% of the bounties handed out. This made it the company in the space that has so far awarded more in bug bounties.

Block.one’s program was launched in May and, shortly after, on hacker claimed $120,000 in bug bounties. If we consider data from before this year, Block.one is followed by Coinbase, which has awarded a total of $290,000 in bug bounties, and by TRON, which has awarded $76,200.

As the news outlet further pointed out, researchers have this year found crippling vulnerabilities in major cryptocurrencies, including bitcoin itself. CryptoGlobe covered at the time that the vulnerability could have been used to inflate bitcoin’s supply above the 21 million limit placed by Satoshi.

This year, a developer who works at the MIT Media Lab’s Digital Currency Initiative (DCI) discovered a bug in Bitcoin Cash that would have allowed malicious actors to “split the Bitcoin Cash blockchain into two incompatible chains."

Back in June, a bug found in ICON’s smart contract was reportedly allowing anyone, except for the contract’s owner, to halt transactions and effectively disable the cryptocurrency’s network. At the time, ICON’s market cap was of $800 million.

Overstock CEO Sells Shares in His Company to Invest in Blockchain Projects

Patrick Byrne, the chief executive officer of Overstock.com (OSTK), has recently lashed out at investors who questioned his sale of 900,000 of his ‘founders shares’ in the company. Justifying his move, he revealed he needed the funds to invest in blockchain projects.

According to Business Insider, Byrne recently sent a letter to shareholders after the company’s stock prices plunged over 21% this week to their lowest since 2012, after he revealed he sold 500,000 of his shares earlier this week.

On Friday, the CEO revealed he sold an additional 400,000 shares, meaning he sold over 15% of his stake in the company. Although Overstock’s shares recovered on Friday, May 17, Byrne’s letter to shareholders was notable. In it, he wrote:

I simply had to supplement my nominal salary with stock sales in order to fulfill personal commitments to invest personally in blockchain projects such as Medici Land Governance, along with a need to meet charitable pledges.

The CEO added that he doesn’t plan on giving such an explanation again, justifying that he owes shareholders “staying within the law and not making decisions based on inside information, not explanations of my life and projects outside Overstock.”

He noted that the “unanticipated stir” caused by his sale was unexpected, and added “I had no idea that shareholders would demand explanations of why and how I might want to use my cash derived from my labor and my property to pursue my ends in life.”

Byrne is notably Overstock’s largest shareholder, and noted he told investors a year ago he would be making “significant sales” to fund different projects, including those related to blockchain technologies and, presumably, cryptocurrencies.

In fact, the libertarian sold 775,000 of his shares in September of last year, before this week’s sale. The stock’s price has fallen roughly 90% from its record high in January of 2018, when Overstock was benefitting from its cryptocurrency ventures and accompanying the cryptocurrency market’s performance.

In November of last year, Byrne revealed he had plans to sell Overstock’s retail business and go “all-in” on cryptocurrencies and blockchain technology. The CEO’s plan would see the company focus on its fully-owned subsidiary Medici Ventures, which has been invested in blockchain-related startups, after selling its retail business.

Overstock's price performance over the last two yearsSource: Yahoo Finance

Byrne has notably been battling short sellers targeting Overstock, as the firm competes with the likes of eBay and Amazon. Financial analytics firm S3 Partners has estimated short bets against it stand at $157 million, or 50% of its float. This makes it more targeted by short sellers than 99% of companies in the U.S.

Despite the company’s performance on exchanges, Overstock has since launched its tZERO security trading platform, and was one of the first companies to pay a “portion” of its taxes using bitcoin in Ohio.