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Alex protocol, a Bitcoin layer two (L2) network bridge that leverages the Stacks ($STX) chain to enhance BTC-native DeFi applications, has issued an update on its recent attack. According to an X post earlier today, the Alex protocol attacker had created more than 4,700 unique addresses, up from only 100 in the last seven days.
As a result, the Alex protocol attacker broadcasted over 9,700 traceable transactions to distribute the stolen $STX tokens.
The company indicated that the attacker’s current traceable $STX deposits into centralized exchanges (CEXs) are 8,373,587 $STX. On the other hand, the attacker’s on-chain balance was around 5,560,332 $STX tokens, which is calculated based on wallet balances above 100 $STX units
ALEX Security Update
— ᛤ ALEX 🟧 THE Finance Layer on Bitcoin ᛤᛤᛤ (@ALEXLabBTC) June 17, 2024
As of June 17th at 11AM, the attacker has broadcast more than 9700+ transactions, which involve generating new wallets addresses then dispersing the on-chain $STX balance across those new wallets.
The number of traceable transaction started to grow… pic.twitter.com/BZ3TPevqor
Closer Look at Alex Protocol Attack
According to on-chain data analysis conducted by the Certik platform, Alex Lab was compromised through its private keys in a smart contract upgrade. The attacker is believed to have used the same techniques as the Ronin bridge hacker, who was responsible for a loss of more than $600 million in digital assets.
Based on the recent information, the Alex Lab attacker is confident of a successful strike rate. Furthermore, the Alex Labs team previously offered the attacker a 10 percent bounty reward, which the hacker disregarded despite reports of an identity breach.
Market Implications
Following the Alex Labs attack, Stacks ($STX) value has declined over 16 percent in the past week to trade at about $1.82 on Monday. Although the Alex Labs team indicated that the majority of the CEXs have frozen the stolen funds, the attacker has managed to liquidate a portion, thus weighing heavily on the underlying assets amid a crypto bearish outlook.