Starknet faced a severe setback during its highly anticipated airdrop event on February 20th. What was meant to be a celebratory token distribution event turned into an attack scene as the malicious actor exploited the system and executed one of the most significant Sybil attacks in the history of cryptocurrency.
Unfolding the Sybil attack
An attacker cunningly manipulated the system during the airdrop by utilizing multiple 1,361 wallets to claim the distributed tokens. According to the data provided by on-chain investigator, lookonchain, the attacker by aggregating the tokens from these multiple wallets into a single address managed to siphon off 1,432,800 STRK tokens, valued at approximately $3 million at the time of the attack.
All these stolen funds were transferred to a single wallet address “0x027c…9078.” . Whats surprising is just a few minutes ago, another airdrop hunter received 1.22M $STRK valued at $2.4M through 1,800 wallets bringing the total sum of the attack to $5.4 Million.
Impact on token price and market volatility
A Sybil attack is a cybersecurity attack that involves creating multiple accounts and pretending to be many people at once. The aftermath of these Sybil attacks affects the entire market. It caused significant volatility in Starknet’s token price. At the time of writing, the token is standing at a value of $1.89 with a sharp decline of 57.2%.
Despite the project’s recent listing on Binance which initially fueled optimism and led to a surge in trading activity, the market sentiment quickly soured following news of the airdrop key details. This trend is very common in such airdrops and comes back to normal after heavy pumps.
Moving forward with the lessons learned
The importance of robust security protocols and risk management practices in the cryptocurrency space keeps increasing with time. Often, airdrop events reward community members and foster active engagement.
On the negative side, they attract malicious actors seeking to exploit vulnerabilities for their gain. Gains through unfair trade are illegal and crypto platforms should revise their security to high levels to avoid such pity attacks.
Qadir AK
Qadir Ak is the founder of Coinpedia. He has over a decade of experience writing about technology and has been covering the blockchain and cryptocurrency space since 2010. He has also interviewed a few prominent experts within the cryptocurrency space.
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