- Euler Finance suffered the largest DeFi hack of 2023, losing $197 million, with alleged connections to a North Korean address and partial funds return by the hacker.
- The hacker returned 3,000 ETH to Euler Finance’s deployer account, but the chances of returning the entire stolen amount remain slim.
- The stolen funds were moved into the crypto mixer Tornado Cash, suggesting the hacker might not be swayed by Euler’s amnesty offer.
The cryptocurrency world has been closely watching the most prominent decentralized finance (DeFi) hack of 2023, which saw Euler Finance lose a staggering $197 million. With multiple twists and turns in this unfolding story, from partial fund returns to possible North Korean involvement, the hack has kept the crypto community on its toes.
North Korean Connections and Some Stolen Ether Returned
One of the most intriguing aspects of the Euler Finance hack is the alleged connection to North Korea. According to blockchain investigator Chainalysis, 100 Ether (ETH) from the stolen funds was transferred to an address previously flagged in an older hack linked to North Korea. While Chainalysis has raised the possibility of misdirection by other hackers, the North Korean connection remains an alarming detail.
In an unexpected turn of events, the hacker reportedly had a change of heart and returned 3,000 ETH (approximately $5.4 million) to Euler Finance’s deployer address on March 18. Blockchain investigator PeckShield identified three transactions used to send the funds back. However, the chances of the hacker returning the entire $197 million remain slim, as no more outbound transactions were recorded at the time of writing.
This partial return of stolen funds came after Euler Finance announced a $1 million reward for information leading to the arrest of the hacker and the retrieval of the funds. Whether this was an attempt to troll or a genuine consideration of accepting Euler Finance’s bounty reward of $20 million remains to be determined.
Crypto Mixer Tornado Cash and Victim Refunds
After Euler Finance announced the $1 million bounty, the hacker moved the stolen funds into the crypto mixer Tornado Cash, possibly indicating a lack of interest in Euler’s amnesty offer. Blockchain analytics firm PeckShield reported that the hacker had transferred approximately $1.65 million through Tornado Cash.
Interestingly, the hacker seemed to have refunded at least one victim, sending around 100 ETH to a wallet address believed to belong to one of the victims. This led to several other purported victims sending on-chain messages to the hacker’s address in the hope of having their funds returned as well. Some notes described life savings being lost, while others mentioned the impact on families and individuals who desperately needed the funds.
Euler Finance’s Offer: Keep $20M or Face the Law
Euler Finance attempted to strike a deal with the hacker by demanding the return of 90% of the stolen funds within 24 hours or facing legal consequences. The platform sent a message to the hacker’s address, stating that if the majority of the funds were not returned within the given timeframe, a $1 million reward would be launched for information leading to the hacker’s arrest and the return of all funds.
Under the proposed deal, the hacker would keep $19.6 million while returning $176.4 million. However, many observers have noted that the hacker has little to no incentive to comply with the deal, given the significant amount of money they managed to steal.
