After a malicious actor hacked the operator contract of the blockchain and produced 1 billion HLG tokens valued at $14.4 million, the native token (HLG) of the Blockchain Tokenizing Platform plummeted to as high as 79.4%. Confirmed by Holograph’s X account on June 14, the hack took advantage of a smart contract vulnerability and had major effects on the market.

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Bad Actor Uses Vulnerability in Smart Contract

Etherscan reports that the hacker minted one billion HLG tokens across nine transactions; the first mint took place on June 13 at 9:47 a.m. UTC. The hacker shipped seven of these in one hundred million batches. Within ten minutes, HLG’s price started to collapse from $0.014 to a local low of $0.0029 over nine hours. According to CoinGecko, HLG’s market value dropped dramatically from about $22 million to $4.8 million in the same period. HLG has subsequently recovered somewhat to $0.008.

Efforts of Holograph to Investigate and Control Damage

According to Holograph, it fixed the first hack and is now working with bitcoin exchange partners to freeze the malevolent actor’s accounts. The platform is also contacting law enforcement to handle the matter and starting its own probe.

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Venture financing company CMT Digital’s cryptocurrency researcher Matt Casto speculated that the hacker might have been a “rogue developer,” funding Holograph’s operator contract address 26 days before the attack.

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More General Effects on Industry Trust and Crypto Security

Based on the Omnichain ecosystem, Holograph lets tokens flow between blockchains using the same contract address, therefore allowing asset issuers to index cross-chain data. Renowned companies like Animoca Brands and Mechanism Capital have provided venture capital to the platform.

This event emphasizes the continuous security issues in the bitcoin sector. Based on a new Crystal Intelligence analysis, since the first industry hack surfaced in June 2011, around $19 billion in cryptocurrencies have been pilfers. The Holograph attack emphasizes how security policies must always be improved if we want to safeguard digital assets and maintain investor confidence.

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