Web3 is Going Just Great

The project blamed the theft on a previous contractor who had the private key. They also explained that the attacker seemed to be a developer based on the fact that they had "specialized knowledge of ZERO's internal security systems".

The attacker stole around 490 ETH (~$1.8 million) and $58,000 USDC, along with more than 130 Milady NFTs, 320 Remilio NFTs, and hundreds of derivative tokens issued on the NFTX platform. Based on floor prices, the assets are valued at north of $6 million.

The mechanism of the attack is still uncertain, though Fang has said he suspects malware that could have intercepted credentials to his Bitwarden password manager. Some have expressed skepticism around the "hack", suggesting it could have been inside job. The Remilia group had suffered a separate $1 million loss in September 2023 — blamed on a rogue developer — and failed to implement many security safeguards after that incident.

Most experienced crypto users have adopted the habit of sending small test transactions before transferring large amounts of tokens, to first check that they're using the correct address. Oddly, this person did so in this case, but then went right ahead and transferred the remaining tokens to the erroneous address.

The person may have lucked out that they were using a centralized stablecoin like Tether, whose operators hold a substantial amount of control over freezing, destroying, and creating new Tethers — and could feasibly replace the burned tokens.