Crypto theft at Fusion may have been inside job

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The Fusion swap wallet was hit by hackers on September 28, resulting in the theft of 10 million native FSN and 3.5 million ERC20 FSN tokens, according to a blog published by the company. They report that the only this wallet was affected and that they have not received any other reports of theft.

The impact was immediate. The value of FSN was cut by half, going from around $0.50 to below $0.25 in just over seven hours.

Fusion Protocol is powered using a blockchain-based platform. This allowed for the exchanging of “stablecoins” and other digital tokens.

The theft already have investigators believing that this may be an inside job. In the post, it was written, “There is uncertain evidence showing that theft may have been caused by personnel related to the Fusion Foundation.”

Some indicators were provided as to why Fusion believes this was an inside job. This includes the announcement that the private key to Fusion’s wallet had been stolen. However, they did assure customers that the technology used to power the platform “remains secure.”

During this last summer, Fusion Foundation migrated the FSN tokens away from the ERC-20 standard. Their purpose was to bring legacy financial institutions into their blockchain network by easily facilitating the transfer of stablecoins and other types of digital assets.

In an interview following the announcement, Chief product Ofc. John Liu explained that the company has already developed a clear understanding of how the hacker was able to de-monetize their take. “This is not a newbie hacker. This criminal has been preparing this in advance,” Liu explained in the interview. “He was well prepared to implement this.”

Currently, the foundation is tracking the coins and is working to isolate them. To this point, the vast majority of the hijacked funds have gone through two primary exchanges, Bitmax and Hotbit. As part of the investigation, OKEX, Huobi, Bitmax, Citex, and Hotbit have stopped accepting any further deposits or transfers of FSN.

No information has been provided on how they are isolating these specific funds. It is believed that information will not be released until a further date, if at all. The reality is that with over 25% of the network’s coins being stolen, there is an incredible need to act quickly and to ensure that they are able to retrieve these funds expeditiously.