When cryptocurrency platforms, hackers, and Initial Coin Offerings (ICOs) hit the spotlight, it is rarely good news.
ICOs, events in which project or company tokens are exchanged for traditional cryptocurrencies such as Bitcoin and Ethereum (ETH), are now a prime target for attackers.
Time and time again ICOs are compromised, investor funds are stolen, or exit scams -- in which ICOs are launched and then projects abruptly vanish -- are commonplace.
Israel-based CoinDash, a cryptocurrency portfolio management platform due to formally launch within the next 24 hours, was one such victim of a compromised ICO.
In July last year, a cyberattacker changed the CoinDash wallet address posted on the firm's website to one they owned during the event, leading to the theft of millions in ethereum. At the time, losses were estimated at $7 million, and investors were promised their funds not in their original cryptocurrency, but the CoinDash event token.
"CoinDash is responsible to all of its contributors and will send CDTs [CoinDash Tokens] reflective of each contribution," CoinDash said at the time. "Contributors that sent ETH to the fraudulent Ethereum address, which was maliciously placed on our website, and sent ETH to the CoinDash.io official address will receive their CDT tokens accordingly."
In September, as the price of ethereum continued to soar, the attacker believed to be behind this attack inexplicably returned 10,000 ETH. Now, CoinDash has announced that a further 20,000 ETH has been returned to the platform.
Both of the transactions can be viewed through the CoinDash public wallet and are linked to one of the wallet addresses of the attacker, named "FAKE_CoinDash."
At today's prices, the returned funds are worth roughly $17 million.
"Similar to the hack itself, the hacker's actions will not prevent us from the realizing our vision, CoinDash product launch will take place next week as originally intended," said CoinDash CEO Alon Muroch.
The company added that Israel's Counter Cyber Terrorist Unit has been informed.
You have to wonder whether the forming of a conscience and apparently benevolent act taking place in two parts is really the core of the story -- especially when the latter occurs just before the CoinDash product launch. It's possible an alternative explanation is at play, especially as no demands were made by the alleged attacker when returning the funds.
As always, never invest more than you can afford, especially when it comes to a volatile industry such as cryptocurrency.
According to Ernst & Young, over 10 percent of funds changing hands through ICOs end up either lost or stolen.