On September 23, a security breach occurred at UXLink, a Web3-based social platform that uses artificial intelligence (AI).
The incident led to the unauthorized creation of its native cryptocurrency, which caused its value to fall by more than 90%.
The issue began when the platform’s team detected a compromise in its multisignature wallet. Later, they noticed large sums of cryptocurrency being moved without permission to centralized and decentralized exchanges.
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UXLink contacted these platforms to freeze suspicious transactions and also involved law enforcement. According to the company, several exchanges were able to halt the transfer of a portion of the stolen assets.
After confirming the wallet breach, the team reported that the attacker had begun creating new UXLINK tokens without approval.
PeckShield initially recorded the minting of 1 billion tokens and later noted that another 1 billion had been added. However, blockchain analysts at Hacken observed that the attacker minted nearly 10 trillion tokens in total.
Despite generating such a large number of tokens, the attacker only exchanged about 9.95 trillion of them for 16 Ethereum
In response, UXLink requested that exchanges pause trading of its token. The company also said it is preparing a token replacement plan to prevent further damage.
In its final update, UXLink mentioned submitting a new smart contract for a security review.
Ironically, while carrying out the exploit, the attacker themselves became a victim. Lookonchain showed that the hacker lost over 500 billion UXLINK tokens to a phishing scam.
Recently, Raivo Plavnieks, a Latvian content creator raising money for cancer care, lost over $31,000 in crypto. How? Read the full story.
