- A former Amazon engineer, Shakeeb Ahmed, admitted to hacking cryptocurrency sites, marking the first such conviction.
- Ahmed faces up to 5 years in prison and must return $12.3 million in stolen cryptocurrency.
- Hackings targeted Nirvana Finance and exploited vulnerabilities in smart contracts used by cryptocurrency exchanges.
This week, a person who used to work as an engineer at Amazon admitted to hacking two cryptocurrency trading websites. This is a significant case because it’s the first time someone has been found guilty of hacking a special type of computer program used in cryptocurrency.
The person, Shakeeb Ahmed, who used to have a job at Amazon as a security expert, is now going to prison for up to five years. Additionally, he has to give back cryptocurrency worth $12.3 million that he stole. This information comes from a statement made by the United States Attorney for the Southern District of New York.
The hacking incidents happened in 2022, and the targets were Nirvana Finance and another cryptocurrency exchange on the Solana blockchain.
Blockchain is a secure digital ledger for storing information and transactions without relying on a central authority. Ahmed, a former Amazon engineer, exploited vulnerabilities in smart contracts used by cryptocurrency exchanges to manipulate transactions and earn millions in undeserved fees. He targeted another cryptocurrency, ANA, used by Nirvana, making a $3.6 million profit.
Despite Nirvana’s $600,000 reward offer, Ahmed demanded $1.4 million and refused to return the stolen funds, leading to Nirvana’s closure. He stole over $12 million and tried to conceal his actions using Monero, cryptocurrency mixers, and foreign exchanges. Representatives from the US Attorney’s office have not commented.
In theory, a smart contract is supposed to remove the risk of fraud from intermediaries like brokers. However, these programs have been prone to attacks by hackers.
In 2022, approximately $2.2 billion in cryptocurrency was stolen from Decentralized Finance (DeFi) projects. These projects allow people to do financial transactions without involving third parties or banks.
According to The New York Times, many of these thefts happened because hackers exploited weaknesses in smart contracts. Smart contracts are created using open-source code, which means that hackers can study how the software works and use any weaknesses they find to their advantage.
