Solana Wallet Exploitation Drained over $5 Million

After a devastating loss of the Ronin crypto bridge of $190 million in crypto assets, another exploitation of the famous Solana Wallet compromised over 8,000 wallets on the blockchain. The hack was initiated to drain users out of their funds in SOL, SPL, and other Solana-based tokens, resulting in a total loss of over $5 million.

How did Solana wallets drain overnight?

An exploit allowed a malicious actor to drain funds from a number of wallets on Solana. As of 5am UTC approximately 7,767 wallets have been affected.

The exploit has affected several wallets, including Slope and Phantom. This appears to have affected both mobile and extension.

— Solana Status (@SolanaStatus) August 3, 2022

Although the specifics of the theft are still unknown, it appears that most users of Solana wallets like Phantom and Slope lost their funds overnight. According to the company’s official Twitter account, around 7,767 wallets have been affected, and the breach impacts users of both browser extensions and mobile wallets.

Amid the current chaos, several crypto specialists and security firms are investigating the hack and what is the root cause of the depletion of funds. In the light of potential loss in the future, the company has laid down some important steps to protect the unaffected accounts on the blockchain and urged users to follow them.

The best practices to protect wallets on Solana

There’s no evidence hardware wallets have been impacted – and users are strongly encouraged to use hardware wallets.

Do not reuse your seed phrase on a hardware wallet – create a new seed phrase.

Wallets drained should be treated as compromised, and abandoned.

— Solana Status (@SolanaStatus) August 3, 2022

In the latest Tweet by Solana Status, the company has insight into the hack and what users can do to protect their funds on the Solana Wallet blockchain. Since this breach did not compromise hardware wallets, the Tweet asked users to switch to hardware wallets for now and transfer their funds from mobile wallets and browser wallets.

The Tweet also stated about not reusing seed phrases on hardware wallets, and users are encouraged to create new seed phrases for all of their hardware wallets. Lastly, Solana advised that the users should abandon all the compromised wallets and are required to fill this form to form.

What’s next for crypto wallets?

The continuous exploitation of crypto wallets will reopen the debates about the authenticity of crypto and whether it is safe to use or if we still need a more secure way of storing cryptocurrencies. Since hardware wallets are not practical in the internet world, the question remains open about the security factor of cryptocurrencies and wallets on the blockchain.