Senior Security Engineer Pleads Guilty to Hacking Crypto Exchanges
A senior security engineer, Shakeeb Ahmed, has pleaded guilty to computer fraud for hacking two decentralized crypto exchanges. This marks the first-ever conviction for hacking a smart contract. The announcement of Ahmed’s guilty plea was made by Damian Williams, the United States Attorney for the Southern District of New York.
Crypto Exchange Hack
The first hack targeted a crypto exchange that allowed users to trade various cryptocurrencies. Ahmed exploited a vulnerability in the exchange’s smart contracts, resulting in approximately $9 million in fraudulent trading fees. After the theft, Ahmed entered into discussions with the exchange and offered to return most of the stolen funds if they didn’t involve the police.
Nirvana Finance Attack
In another attack, Ahmed targeted decentralized finance protocol Nirvana Finance. Using a flash loan, he secured around $10 million and manipulated Nirvana’s smart contracts to profit around $3.6 million. Despite Nirvana’s bug bounty offer, Ahmed demanded $1.4 million, leading to the closure of the protocol after he kept all stolen funds.
Facing Five Years in Prison
Ahmed pleaded guilty to one count of computer fraud and faces a maximum sentence of five years in prison. He has agreed to forfeit over $12.3 million, including approximately $5.6 million worth of stolen cryptocurrency. Ahmed is scheduled for sentencing on March 13, 2024.
Hot Take: Security Engineer Behind Multi-Million Dollar Crypto Exploits
A senior security engineer has admitted guilt in hacking two decentralized crypto exchanges, marking the first conviction for hacking a smart contract. The engineer exploited vulnerabilities in smart contracts, resulting in millions of dollars in fraudulent trading fees and profits. The hacks targeted a crypto exchange and decentralized finance protocol, leading to the closure of the latter. The engineer has agreed to forfeit millions of dollars and faces up to five years in prison. This case highlights the importance of robust security measures in the crypto industry and serves as a reminder that even those with specialized skills can engage in criminal activities.
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