Crypto Market Maker Wintermute Hacked for $160M

By
Tobi Opeyemi Amure
Tobi
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Tobi is a freelance crypto writer at Investopedia. He aims to simplify the complex concepts of blockchain and cryptocurrencies for the masses.
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Published September 21, 2022

One of the leading crypto market makers, Wintermute, has lost about $160 million in a hack, becoming the latest crypto firm to suffer a breach. Wintermute's CEO and founder, Evgeny Gaevoy, revealed in a series of tweets that the firm's decentralized finance operations were compromised on Sept. 20.

A crypto market maker provides liquidity on crypto exchanges through digital assets. Currently, Wintermute provides liquidity across over 50 exchanges and trading platforms, including Binance, Coinbase, FTX, Kraken, and decentralized platforms Dydx and Uniswap. 

Key Takeaways

  • Cryptocurrency market maker Wintermute got hacked for $160 million. 
  • Wintermute claims to be solvent despite being in debt of $200 million owed to several DeFi platforms.
  • The platform plans to pay the hacker 10% of the looted funds if the money is refunded.


$200M in Outstanding DeFi Debt

A major challenge facing the UK-based crypto market maker is repaying millions of dollars in debt. It owes over $200 million to several counterparties in the decentralized finance (DeFi) space, which makes the situation murkier. However, CEO Gaevoy has claimed that the firm isn't defunct and remains solvent.

In another another, the company reassured all its partners, saying, “We are able to return any or all outstanding loans if requested, although we would greatly appreciate if these are not recalled.''

Offered a 10% Bounty to the Hacker

Gaevoy and Wintermute did not reveal how the hackers were able to succeed, or whether law enforcement was notified. However, to speed up the damage control process, the firm has offered a 10% bounty on funds taken to the hacker. Gaevoy said the hacker should keep $16 million and refund the balance to an address he made public: 0x4f3a120E72C76c22ae802D129F599BFDbc31cb81.

The Bottom Line

The news of crypto hacks isn't uncommon, as bad actors exploit every little error and vulnerability to loot millions of dollars. 2022 has been a busy year for major DeFi hacks. This year alone, 1.9 billion were stolen through hacks, according to blockchain analysis firm Chainalysis.

In August, Nomad, a cross-chain bridge, lost $190 million in just under three hours. The largest ever DeFi hack occurred in March 2022, when a North Korean group was able to steal over $624 million from the Ronin Network.

Article Sources
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  1. Twitter. ''@EvgenyGaevoy. 4:03 AM · Sep 20, 2022''

  2. Wintermute. ''wintermute.com''

  3. Twitter. ''@EvgenyGaevoy. 4:03 AM · Sep 20, 2022''

  4. Twitter. ''@wintermute_t. 6:22 AM · Sep 21, 2022''

  5. Twitter. “@EvgenyGaevoy.4:59 PM · Sep 20, 2022''

  6. Blog.chainalysis.com. “Mid-year Crypto Crime Update: Illicit Activity Falls With Rest of Market, With Some Notable Exceptions."

  7. Twitter. ''@samczsun. 7:45 PM · Aug 1, 2022''

  8. Twitter. ''@WatcherGuru. 8:10 AM · Apr 9, 2022''

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