Last weekend, an anonymous hacker took control of the cryptocurrency mixing platform Tornado Cash and suspiciously suggested returning everything to its rightful owners.
The hacker’s proposal was approved by an overwhelming majority on Friday (26) and can be implemented by any member of the Decentralized Autonomous Organization (DAO) over the next two days.
This will result in control being returned to the community and reverting most of the changes made by the hacker. However, in the week the hacker was in control, more than $1 million was looted from the system.
Tornado Cash hacked
Tornado Cash is a US Foreign Assets Control Agency (OFAC) approved cryptocurrency mixer designed to hide transactions.
It is created by a DAO who is responsible for its maintenance and development. The hacker exploited a malicious board proposal and created more than 1 million fake votes to take control of the system.
As of Friday, approximately 470,000 TORN tokens have been sold and exchanged for ETH. The hacker deposited 572 ETH into Tornado Cash for money laundering, according to Ronghui Gu, co-founder of blockchain security and audit firm CertiK.
While the protocol itself was not compromised at the time of the hack, the current situation, with the hacker still controlling a significant portion of the DAO’s funds, could lead to the decline and stagnation of Tornado Cash.
Ronghui Gu stressed that this type of hack is becoming more common and suggested that DAOs should undergo external audits of their code to prevent such attacks. However, this slows down the voting and deployment process and is expensive.
“We believe the bid audit process is necessary, but we currently have no established industry practice”Gu said.
return of funds
While rare, there have been cases in the past where hackers were convinced to return some of the stolen money as long as they could keep some for themselves. However, it remains to be seen whether the Tornado Cash hack will return the stolen tokens.
After the hack, the TORN token suffered a 50% drop to $3.60, but recovered somewhat to trade at $4.17 this Saturday afternoon (27), according to CoinMarketCap. The uncertain future of the operating system continues to affect the value of the token, which is down nearly 3% in the past 24 hours.
The community now awaits the implementation of the hacker’s proposal to see if control will be effectively returned and what measures will be taken to strengthen the security of the Tornado Cash protocol in the future.
Source: Live Coins

Barry Siefert is an accomplished journalist and author at The Nation View. He is known for his expertise in the field of cryptocurrency, and has written extensively on the topic. With a background in finance and economics, Barry has a deep understanding of the underlying technology and market forces that drive the crypto industry.