AERGO

KuCoin Exchange Hack Update

in Blog
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Dear AERGO Community

On September 26, 2020, a hacker breached the KuCoin exchange’s security systems and gained access to the private keys to their hot wallets. Over the course of a few hours, they were able to withdraw nearly $200M in BTC, XRP, BSV, XLM, TRX, stablecoins, ETH, and other ERC-20 tokens. Of these assets, the entire supply of AERGO ERC-20 tokens held on KuCoin were also stolen, resulting in 66.8M AERGO ERC-20 tokens being compromised. This means that a total of 13.3% of the AERGO supply is in the possession of the hacker.

This unfortunate circumstance affects all of our stakeholders and community members, so the AERGO Foundation has appointed a specialized 24/7 rapid action task force to combat the situation and work on solutions to mitigate risks that have come from the hack. As is routine with any major hack, most centralized cryptocurrency exchanges are collaborating to blacklist the hacked assets and both the wider community and our team are tracking the flow of funds 24/7 to track any deposits into exchanges that can be frozen.

Some other assets were deposited on exchanges already and were immediately frozen. However, the vast majority of the assets are still available to the hacker, including the 66.8M AERGO ERC-20 tokens. The hacker is now using Uniswap to liquidate tokens into ETH.

KuCoin has expressed that the total amount of hacked assets are only a small amount of their total Assets Under Management. KuCoin has asserted that they have their own insurance funding and structures to deal with situations like this, and that they will cover the losses to the users *with provisions*. We are still waiting for concrete details and commitments from KuCoin.

 

In the meantime, we are taking the following steps:

  1. 17:00 Korea time Monday, September 28, 2020 we have taken a snapshot of all wallets token balances on block 10949817
  2. 17:00 Korea time Monday, September 28, 2020, we are freezing the AERGO contract
  3. 10:30 to 15:00 KST Tuesday, September 29,2020, we will deploy a new smart contract and migrate AERGO to the new contract. New AERGO ERC20 tokens will be reissued 1:1 via a new smart contract, and automatically distributed to the holders of the previous token.
  4. 15:00 KST, Tuesday, September 29, 2020, we will announce to the community the completion of the migration

 

We are contacting all our exchanges regarding the migration and we are hopeful that transfer and trading of AERGO will be restored without delay.

We are following the situation closely and we are confident that migrating AERGO to a new contract is the correct action to protect our community. Any feedback is appreciated. Thank you for your patience.

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