The CoinDash project attracted a lot of attention during its ICO. Establishing a new type of trading platform will not be easy, but the team feels they can pull it off. Unfortunately, their ICO was hit by a major theft of coins, which saw an unknown assailant steal 44,000 ETH. Considering the vast amount of money this represents, losing these funds could have crippled this or any other project. However, the money was partially returned without any issue, which raised a lot of questions.
CoinDash Funds Returned by Hacker
In cryptocurrency, there have been plenty of incidents involving hacks and scams. In virtually every case, the stolen money is never returned to its rightful owner. That is not entirely surprising, as most hackers can successfully steal millions of dollars without too many repercussions. Converting stolen money to cash or other forms of ready-to-use money is often quite difficult, though.
Given the transparency of most cryptocurrencies, anyone can follow blockchain-based transactions in real time without dedicated software. In the case of the CoinDash ICO, the 44,000 ETH theft was tracked to a fake address pretty quickly. Unlike what most people would come to expect, the funds were apparently not converted to fiat or otherwise used.
Instead, the CoinDash team claims that an unknown assailant returned portion the money to them without any additional problems or demands. That was a very unusual resolution, considering 10,000 ETH has a value of around US$3 million right now. It does not make any sense for a hacker to part with some or all of his or her stolen money willingly and return it to the rightful owner. Nor does it appear any white hat hackers were involved in the process of recovering money. It is a very unusual situation, to say the least.
It does appear 488 ETH was converted using ShapeShift a while ago. The remaining 10,000 ETH were simply sent back to one of CoinDash’s Ethereum wallets. This is pretty unexpected and it raises a lot of questions as to why the hacker returned the money in the first place. Some people will question this “hack” in the first place, considering such a happy ending would not occur under normal circumstances. The transaction ID is there for everyone to see, though.
Converting such a large amount of Ether to any other currency will attract a lot of attention. It is not something one can just sell on an exchange and get away with. All exchanges perform thorough Know Your Customer (KYC) verification, which would allow them to link one’s identity to a theft such as this one. That is not something any hacker wants to risk, for obvious reasons. Then again, just returning the money without any official explanation is pretty gutsy regardless.
One could say the CoinDash team successfully dodged a major bullet now that a small portion of the money has been returned. After all, losing around US$3 million worth of funds could effectively cripple an ICO. Thankfully, the team can now go ahead with their project in an effort to revamp the cryptocurrency trading industry. It remains to be seen if CoinDash will be successful, though things could get very interesting over the coming months.