Holograph Hack Results in 79.4% Plunge of Native Token HLG
June 14, 2024 — Blockchain tokenization platform Holograph experienced a significant security breach, leading to a dramatic fall in the value of its native token, HLG. The malicious actor exploited a vulnerability in the protocol’s operator contract, minting 1 billion HLG tokens valued at $14.4 million.
Holograph confirmed the incident on their X account, stating that they have since patched the exploit and are collaborating with cryptocurrency exchanges to freeze the hacker’s accounts. The platform has also initiated its own investigation and is in contact with law enforcement.
Details of the HLG Exploit
The exploit was executed by minting 1 billion HLG tokens across nine transactions. The first transaction was recorded on June 13 at 9:47 AM UTC, according to Etherscan. Seven of these transactions involved 100 million HLG tokens each. The token’s price began to plummet just ten minutes after the first minting, dropping 79.4% from $0.014 to a local low of $0.0029 within nine hours. Consequently, HLG’s market cap fell from nearly $22 million to $4.8 million during this period, as per CoinGecko data. The token has since rebounded slightly to $0.008.
At the current price, the hacked 1 billion HLG tokens are valued at $7.4 million. However, the hacker had already started converting the minted tokens into stablecoin Tether (USDT) around four hours after the exploit began.
Investigation and Speculation
Matt Casto, a cryptocurrency researcher at venture capital firm CMT Digital, suggested that the hacker might be a “rogue developer” who funded Holograph’s operator contract address 26 days prior to the attack.
Holograph has not disclosed if it knows the identity of the hacker.