NEO Co-Founder Erik Zhang Responds to Bug: No “Possibilities of a Token Theft”

Justine Pope
  • It was previously suspected that the smart contract platform NEO had a bug that would allow hackers to steal funds remotely.
  • To clear the confusion, NEO Co-Founder Erik Zhang responded that “users of the NEO blockchain will not suffer the possibilities of a token theft.”

Over the weekend,  CryptoGlobe reported that NEO might have a fatal security flaw. From this original article, it appears that NEO, often hailed as the “Chinese Ethereum,” had an error that would allow hackers to steal user’s tokens from the public blockchain without the users knowing.  Found by Tencent, a Chinese technology giant, this bug was originally disclosed on Weibo (Chinese Twitter):

Monitoring the famous blockchain project NEO (corresponding to the digital currency "Antcoin") has the risk of remote piracy. When a user starts the NEO network node with the default configuration and opens the wallet, the digital currency may be remotely stolen

Just hours later, NEO responded on Weibo. Erik Zhang, co-founder of NEO, clarified that the vulnerability didn't affect "normal users," noting that "all in all, normal users of the NEO blockchain will not suffer the possibilities of a token theft operated from afar."  His words came in an attempt to qualm the fears of NEO holders.

His message was shared in English on CoinNess. NEO later confirmed this on their Twitter account, by sharing a screenshot of Zhang’s response:

The bear market has not been nice to this smart contract platform. NEO is currently trading at $7.71, down 96% from its all-time high of $194.79. NEO has also dropped in its rankings. During the peak of the bull market, NEO was the #6 cryptocurrency by market cap. Now, it’s been pushed all the way down to the #18 spot, falling behind competitors like ETC and BNB.

This is not the first time NEO has been victim of similar claims, which sme claim to be an attempt to create fear, uncertainty, and doubt (FUD). Most notably, researcher Eric Wall posted a lengthy takedown of NEO earlier in the year:

 

Bitpoint Reveals Breakdown of Funds Stolen and Pledges Reimbursement After Hack

Neil Dennis

Japan's Bitpoint cryptocurrency exchange has published a breakdown of the assets lost in this month's security breach where hackers stole around Y3 billion ($28 million), and has pledged to reimburse customers.

A document published by parent company Remix Point on Tuesday showed that of the Y3.02 billion stolen, Y2.6 billion belonged to customers, while Y960 million were company-owned assets.

Here's the full breakdown:

  • Bitcoin BTC1,225 - total stolen worth Y1.53 billion at the time of attack: Y1.28 billion belonging to customers and Y250 million to the exchange
  • Bitcoin cash BCH1,985 - worth Y70 million at time of attack: Y40 million customer owned and Y30 million exchange owned
  • Ether ETH11,169 - worth Y330 million at time of attack: Y240 million customer owned and Y90 million of exhange's
  • Litecoin LTC5,108 - worth Y500 million, with about Y40 million in customer funds
  • XRP28,106,323 - worth Y1.03bn at the time of attack of which around a quarter were customer funds

Reimbursement

Remix Point added in its Tuesday statement that it would reimburse customer losses, compensating them in lost cryptocurrencies rather than their fiat equivalent.

The exchange revealed on Sunday it had already tracked $2.3 million worth of stolen tokens. Reported by Finance Magnates Bitpoint said it had recovered the funds and reabsorbed them.

Bitpoint said last week's security breach occurred due to unauthorized access to private keys of its hot wallets and now intends to move all holding into cold storage, where no breaches of security had been detected.

Co-operation With Regulators

Remix Point said in the document published on Tuesday that it was co-operating with self-regulatory body, the Japan Virtual Currency Exchange Association, to help establish better security measures across the industry.

It requested the association, along with its exchange rivals, monitor any suspicious activity in the coming days that might involve the deposit of funds potentially associated with the incident.