IOTA has been able to recover almost $11 million worth of the company's cryptocurrency that was stolen from investors' wallets.
January 31, 2019 | AtoZ Markets - Crimes in the cryptocurrency industry have surged over the last one year. There have been reports of cyber thefts, trade manipulations and other types of criminal offences which have led to about $1.7 billion stolen from investors since 2018. IOTA had its own share of these misdeeds after it announced that a huge amount of IOTA coin which amount to $11 million, was stolen from its investors' wallets. However, there is a good news concerning this, when a top official of the company said most of these stolen funds have been recovered, but the funds are being held to use as evidence against alleged perpetrator who was arrested last week.
Theft Perpetrator Arrested
The Europol, in a combined effort with the UK and German law enforcement agencies, said last week that it arrested a man from Oxford, England, accused of stealing IOTA coins. The 36 years old man allegedly stole $11.4 million worth of IOTA coins from more than 85 victims around the world since January 2018. This was one of many criminal acts recorded in 2018 in the cryptocurrency industry. In 2018, the industry lost more than $650 billion in market value to the bearish trend and $1.7 billion of investors' funds to criminal activities.
According to IOTA co-founder Dominik Schiener, most of the stolen coins has been recovered with just a small amount of the 10 million euros not yet found. In an interview with Reuter, Dominik said:
The exchanges have blocked the hacker's accounts. He tried to free the money, but he did not succeed.
Dominik said he worked with law enforcement agencies for many months on this case. They thought a group of organized hackers was behind this criminal act but were surprised the criminal work was done by an individual ''who had a normal job''. However, the Europol has refused to disclose the name of the hacker. According to Europol, the investigation started in 2018 when some cryptocurrency wallets complained of stolen funds. After much investigation, it was discovered that the fraud has its origin from the domain iotaseed.io that was set to target IOTA cryptocurrency users.
How The Hacking Was Done
According to Europol, the hacker created a malicious seed generator running on Iotaseed.io. IOTA wallets are protected by an 81-digit seed . This is similar to a password. This seed can be generated using online seed generator of which Iotaseed.io was among. Victims who use Iotaseed.io had their seeds stored in the background of the service provider. With these stored seeds, the hacker gained access to the victims' wallet and transferred their funds to other wallets he created with fake IDs.
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