Key takeaways:
- On May 5, a token-minting exploit caused the artificial intelligence network Gnus AI to lose over $1.27 million in value.
- Following that, 100 million fictitious GNUS tokens were created, linked to Ethereum, and offered for sale.
On May 5, a token-minting exploit caused the artificial intelligence network Gnus AI to lose over $1.27 million in value.
The Genius (GNUS) token will soon be updated, and consumers are advised to stop purchasing the previous version, according to the team’s announcement. A blockchain network called Gnus AI enables users to carry out AI calculations in return for tokens.
Blockchain security company CertiK said in a post dated May 6 that the attacker executed the exploit by obtaining the private key to the team’s account, which starts with 0x18.
After taking over this account, they replicated the Ethereum version of the token’s “salt” data, which enabled them to use the Axelar bridge protocol to construct a Fantom network version of the token.
Following that, 100 million fictitious GNUS tokens were created, linked to Ethereum, and offered for sale. Due to the collapse of the ensuing price, token holders’ money was transferred to the attacker, who gained actual assets in return for tokens that were generated out of thin air.
Gnus AI CEO “SuperGenius” asserted that the 0x18 account was compromised when an attacker accessed the team’s secret Discord conversations in a post published on the social networking site X on May 5. He wrote:
“Apparently the hackers can watch private messages on discord”
According to SuperGenius, as a “quick fix,” the group will contribute $500,000 in Ether from its own reserves to a liquidity pool for the newly minted token.
According to CertiK’s estimation, the exploit resulted in losses of $1.25 million, meaning that the inaugural fund distribution will cover 80% of the losses.
Blockchain networks are still vulnerable to attacks. On the other hand, some data suggests that as security procedures advance, these attacks might be decreasing. According to a CertiK study dated April 30, cryptocurrency users experienced the fewest losses from attacks since 2021 in April.
