$1.6 Million Stolen from GeoDB
The Intelligent Insurer #29 - $1.6 million in GEO tokens stolen after a successful attack on GeoDB’s ETH-BTC bridge contract
A few days after the biggest DeFi hack in history, a decentralized peer-to-peer data-sharing platform GeoDBwas also exploited. The ETH-BTC bridge of the platform was attacked by hackers and 4 million GEO tokens, worth roughly $1.6 million, were stolen.
According to an official announcement, the project’s team informed the community that the stolen tokens were dumped on the Uniswap and PancakeSwap decentralized exchanges (DEXs). The team claimed to have suspended the affected bridge and initiated a maintenance process on the platform.
In the latest Intelligent Insurer, we highlight the details of this attack, and how the project’s community is responding to the incident. We also analyze the growing trend of cryptocurrency project hacks and how users are responding to protect their assets from impending risks. But before covering the GeoDB hack, we present our weekly development roundup.
Insured Finance Development Roundup
Over the past week, the Insured Finance development turned our attention to internal testing. Any issues identified as a result of internal testing will be quickly addressed, moving Insured Finance closer to a bug-free and smooth alpha launch.
Through internal testing, we have assessed widespread functionality related to our insurance listings. We identified various features that were not working as expected and we have begun to adjust these ahead of launch.
Over the coming weeks, we will continue with internal testing and assess further functionality related to insurance listings. We will also carry out tests on our token bridges and error pages to ensure that these are fully optimized ahead of launch.
As the alpha launch of Insured Finance comes closer, the development team has begun discussing the strategy surrounding the launch. We will be fully confident that the next-generation marketplace is completely bug-free at launch time and we will have in place cutting-edge technology to ensure that users can have an intuitive and frictionless experience. The launch is to be expected in the first two September weeks.
GEO price falls in hack aftermath
The GeoDB project was primarily designed to reward netizens for the data they generate. They are anticipating to onboard 12 million users. As it stands, the platform has roughly 200k users with roughly 7 million GEO tokens being rewarded among this user base.
An attack on August 14th saw 4 million GEOs stolen from the platform’s network. This resulted in an immediate dump in the price of GEO, falling from $0.4 to around $0.35 within 24 hours.
(Source: TradingView.com)
GEO Attack Details
The technical details of the attack are unknown and the team only noted that the ETH-BTC bridge contract of the platform was successfully attacked. The stolen funds were traced to the Binance DEX market and the wallet address 0xAB55Eee64E54f25be6efF5D89039d2cdF30dC235 which is assumed to be the hacker’s wallet address. A part of the loot was dumped on PancakeSwap as mentioned earlier, a DEX and yield farming platform that runs on the Binance Smart Chain. The other part of the loot was dumped in Uniswap and is reflected in a spike in the volume of GEO tokens deposited on the DEX.
(Source: Nansen.ai)
Similarly, the balance of GEO tokens also increased by over 700k within 24 hours of the attack. The below graph illustrates the jump in the balance of GEO held on Uniswap.
(Source: Nansen.ai)
48 hours after the hack, the GeoDB platform, having been suspended after the hack, was back online, as announced by the team. Some members of the community replying to the announcement tweet expressed their excitement and intention to buy more tokens at the fallen price. This perhaps resulted in the increased movement observed immediately after the spike, especially with the negative balance change on Uniswap.
Similar to the case of the Poly Network hack, Binance has not interfered with transactions related to the stolen funds. However, the GeoDB project team claims to have contacted the Binance helpdesk concerning the attack.
If the case of Poly Network is anything to go by, the chance of recovering the stolen funds is minuscule. Binance exchange has historically not interfered with any form of transactions on its platform which is certainly an upside for attackers.
As attacks in DeFi continue and grow larger, crypto users are turning to digital asset insurance solutions to mitigate the risk of being impacted by such a development. Insurance solutions like Insured Finance allow users to secure coverage on their riskier investments. In the event of hacks like the GeoDB exploit, users who have insurance against such an event would be fully compensated.
About Insured Finance
Insured Finance is a decentralized, peer-to-peer insurance marketplace. Insured Finance users can request customized insurance on a wide variety of digital assets. Those that fulfill requests earn premiums and can earn a competitive return on their capital. Claims are fully collateralized and settled instantly.