Crypto Startup Offers 10% Bounty For Return Of $190-M Stolen Tokens

Crypto company Nomad is offering hackers a bounty of up to 10% to retrieve user funds after losing nearly $200 million in a devastating security snafu, saying it has recouped only $20 million of the haul, Ryan Browne reported for CNBC.

Photo Insert: The digital heist comes after a vulnerability in Nomad’s code allowed hackers to make off with around $190 million worth of tokens.

Nomad pleaded with the thieves to return the funds to its crypto wallet. “The bounty is for those who come forward now, and for those who have already returned funds,” Nomad said.

The company said it won’t sue hackers who return 90% of the assets they took and regard them as “white hat” hackers. White hats are like the “ethical hackers” in the cybersecurity world.

They cooperate with organizations to alert them to issues in their software. More than $2 billion has been stolen from cross-chain bridges so far this year, crypto analysis firm Chainalysis said.

It comes after a vulnerability in Nomad’s code allowed hackers to make off with around $190 million worth of tokens. Users were able to enter any value into the system and then withdraw the funds, even if there weren’t enough assets available on deposit.

The nature of the bug meant users didn’t need any programming skills to exploit it. Once others caught on to what was going on, they piled in and carried out the same attack.

Nomad said it is working with blockchain analysis firm TRM Labs and law enforcement to trace the stolen funds and identify the masterminds. It is also working with Anchorage Digital, a licensed US bank focused on the safekeeping of cryptocurrencies, to store any fund that gets returned. Nomad is a crypto “bridge,” a tool that links blockchain networks together.

Bridges are a simple way for users to transfer tokens from one blockchain to another.

What happens is users deposit some tokens and the bridge then generates an equivalent amount in “wrapped” form on the other end. Wrapped tokens represent a claim on the original, which users can trade on platforms other than the one they were built on.

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