Australian Company Loses $6.6 Million in Cryptos Due to Backdoor Flaw
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An attempt at collaboration between two companies, Byte Power Party of Australia and Soar Labs from Singapore ended in a massive loss due to a backdoor flaw. Up to $6.6 million in Soarcoins was lost after Soar Labs tried to buy Byte Power Party’s stakes without actually paying for them.
Back in June of the previous year, Byte Power Party released an announcement that a company from Singapore, Soar Labs, will buy 49% of Byte Power’s stakes. The company was to receive $5 million for this purchase, and Soar delivered $100,000 in fiat. The rest was paid in its cryptocurrency, Soarcoin, which was priced at $0.016 at the time. The company sent 306 million of Soarcoins, and everything seemed to be fine.
However, in January of this year, a large amount of those tokens were suspended. According to Soar Labs, this happened due to Byte Power’s scheme to sell the coins at a much higher rate in an attempt to earn enough to pay their debts. The total amount of frozen coins is 213.8 million, where 179.2 million units were in the possession of the company, and 34.9 million were held by the company’s CEO, Alvin Phua.
Soar Labs withdraws the coins
One month later, Byte Power contacted ASX (Australian Securities Exchange) stated that up to $6.6 million in this cryptocurrency was taken from the company’s e-wallets. After investigating, Nicholas Weaver discovered that the smart contract for the Soarcoins has a backdoor. Further details were not released, but it is known that the contract was designed in a way that would allow its issuer, in this case Soar Labs, to take the coins back, and completely fee-free at that.
Read more on: https://cryptocoin.news/news/altcoin/australian-company-loses-6-6-million-in-cryptos-due-to-backdoor-flaw-15496/
