Atomic Wallet Security Breach Results In $35 Million Crypto Heist

Millions of dollars’ worth of cryptocurrencies were stolen from customers of Atomic Wallet. On Saturday, the project’s developers admitted that their users’ data had been compromised.

Atomic Wallet is a cryptocurrency wallet that works on both mobile devices and desktop computers. Multiple platforms, including Windows, Android, iOS, macOS, and Linux, support the wallet.

Atomic Wallet Hack: How Much Was Lost?

Yesterday, the developers of the multichain wallet took to Twitter to announce that they had received reports of account compromises from a small number of users.

We have received reports of wallets being compromised. We are doing all we can to investigate and analyse the situation. As we have more information, we will share it accordingly.

For any questions and concerns, contact support@atomicwallet.io

— Atomic – Crypto Wallet (@AtomicWallet) June 3, 2023

Over a hundred addresses were compromised, and assets from Bitcoin, Ethereum, Tron, BSC, Cardano, Ripple, Polkadot, Cosmos, Algorand, Avalanche, Litecoin, and Dogecoin were taken.

Early indications point to around $35 million was lost.

The largest single loss amounts to $7.95 million USDT. According to on-chain detective ZachXBT, the five largest losses total $17 million.

Source: Atomic Wallet Stolen Fund (Source: ZachXBT)

Early Warning Signs

Since users’ private keys are encrypted and saved locally on their devices, Atomic Wallet believes this makes their product more secure. However, the latest incident proves otherwise.

In fact, the vulnerability of the wallet was evident since February 2021. That year, auditing company Least Authority raised warning flags, saying Atomic Wallet is “insufficiently secure in protecting user assets and private data.”

God damn, All of my hard working money has been vanished from atomic wallet only!!!! This is your responsibility to secure the funds, What will happened to our funds? please do not copy paste anything here! just give all clear answer, Many users are faced with this today!!

— Tom (@Christomos03) June 3, 2023

Twitter users have also alleged that funds on the Atomic Wallet app had previously been stolen. In reaction to the post, one person wrote:

“This happened to my BTC six months ago with Atomic. They simply replied back to protect your pw, seed phrase, blah blah… My response to them, I will use U no MORE then! Now I was right!”

This is seriously scary.

Atomic wallet, despite being around for years, still gets hacked.

I’m trying out several software wallets, but for peace of mind, multisig wins for long-term storage.

Unfortunately, it’s not the most user-friendly way, but you’ll sleep better at night.… pic.twitter.com/LJI0iFnVot

— Ignas | DeFi Research (@DefiIgnas) June 4, 2023

“This is seriously scary,” DeFi researcher Ignas tweeted. “Despite Atomic Wallet’s long history, it is still vulnerable to hacking.”

BTCUSD inches away from falling back into the $26K level. Chart: TradingView.com

Liquidity Problems & Criticisms

Recently, Atomic Wallet has been slammed for offering $BEN token, the meme coin established by “BitBoy,” Ben Armstrong, and for the liquidity problems of its native token, Atomic Wallet Coin (AWC), which fell by 8% today.

Atomic Wallet is currently surveying victims, inquiring as to their operating system, software download location, last actions prior to cryptocurrency theft, and backup phrase storage location.

In order to identify potential attack vectors, the wallet service provider said that it is collaborating with leading security firms.

The investigating team has not been able to confirm anything as of yet.

-Featured image from DayFR Euro