By Tom Blitzer
Key Insights;
- Blockchain Capital co-founder fights back after a $6.3M crypto attack.
- Bart Stephens challenges crypto theft, echoing evolving defenses.
- SIM swap breach unveils hackers’ bold tactics and crypto heist prowess
In a recent update, Bart Stephens, the co-founder of Blockchain Capital, lost $6.3 million worth of crypto in an alleged SIM swap hack. The legal action, initiated on August 16, 2023, intends to uncover and bring to justice the responsible parties behind this cyber breach. Records obtained by Blockworks show that these hackers’ identities remain unknown.
According to the legal filing, the incident transpired over three days, from May 12 to May 14 of this year. The attackers utilized a clever ruse by impersonating Stephens’ brother, Brad.
This impersonation granted them unauthorized access to one of Stephens’ accounts.
$6.3M Crypto Heist Reveals Audacious SIM Swap Tactics
Leveraging this foothold, they purchased a Nokia phone using Stephens’ account credentials. The subsequent execution of a SIM swap involved resetting passwords and skillfully navigating past two-factor authentication challenges.
Remarkably, the hackers also went so far as to send messages to Stephens directly from his own compromised account. These messages conveyed their ability to remotely compromise any mainland US phone number, showcasing their confidence. They further provided a limited timeframe for Stephens to communicate with them via the messaging platform WhatsApp.
Subsequently, the culmination of the hack transpired on May 14, when the hackers successfully drained approximately $6.3 million worth of various cryptocurrencies, including bitcoin (BTC), ether (ETH), maker (MKR), compound (COMP), and uni swap (UNI). These funds were transferred to wallets under the hackers’ control, making a recovery challenging.
Unmasking Ill-Gotten Gains Amid Legal Battle
The hackers tried to appropriate 80 BTC and 6,500 ETH from Stephens’ custodial cold wallet. However, their attempt was thwarted as an employee at Blockchain Capital received an email alerting them to the unauthorized withdrawal activity.
During this incident, Stephens initially realized his multiple accounts were under attack. The legal filing also presented proof of the hackers funneling their illicit gains through decentralized exchanges to obfuscate tracing. Although two such exchanges were mentioned, the document redacted their names.
Unsurprisingly, Stephens seeks compensation for his lost assets and the resources expended on investigating the breach. He also insists on a jury trial, contingent upon identifying and apprehending the hackers.
Crypto Investor’s Legal Battle Against AT&T After $24M Loss
This incident parallels a cybersecurity breach experienced by crypto investor Michael Terpin in mid-2017. While Terpin faced a larger financial loss of $24 million in digital assets, he chose a different course of action, opting to sue his cellular service provider, AT&T, rather than the hackers themselves. The legal proceedings involving AT&T concluded with a ruling in favor of the company before the case could proceed to trial.
In Conclusion, in the face of a $6.3M crypto heist, Bart Stephens takes a stand against the shadows, seeking justice and accountability. As the legal battle unfolds, echoes of past breaches and newfound resilience shape the future of cyber defenses.