2022 has certainly not been a favourable year for the Solana ecosystem. While the crypto space is facing a bear market the last thing the space needs is another crypto hack.

The Solana ecosystem has been the target of various attacks leading to the loss of over a billion dollars. At the time of writing, Solana was trending on all social media platforms following an ongoing SOL attack.

According to various reports, Solana wallets have succumbed to a widespread attack, as the private keys to several wallets have been compromised. Users report that their funds have been withdrawn without their authorization or involvement. Over $7 million worth of SOL and USDC has already been siphoned from the affected accounts. 

 What happened?

On 2 August 2022, Blockchain investigator PeckShield pointed out that the widespread attack resulted from a supply chain issue that had been exploited to steal the private keys of the affected wallets. Most of the affected wallets have been inactive for more than six months, and mostly Phantom and Slop wallets were affected. 

According to a famous scam detective and self-acclaimed on-chain sleuth, @Zachxbt, the attack was tied to a Binance wallet address. Zach pointed out that the hackers initially funded the primary account associated with the attack via a Binance wallet seven months prior. 

Upon reviewing the transaction history of the address, Zach discovered the wallet had been dormant until 3 August 2022, just before the attackers performed transactions with four different wallets 10 minutes before the attack was executed. 

According to crypto enthusiast and writer Foobar, simply revoking approvals for the transfers might not help keep users’ digital assets safe. However, the only viable way is to transfer the assets to a hardware wallet. If a hardware wallet is unavailable, Foobar advises crypto holders to consider moving their assets from centralized exchanges to other solutions. 

The Solana community responds to yet another crypto hack.

The Solana logo at the tim of another crypto hack

Phantom, a Solana-based wallet provider, announced through its Twitter account that they were working with other teams to unravel the main cause of the attack. However, they further pointed out that the attack was not isolated to the Phantom wallet but might be a widespread issue. Magic Eden, another wallet provider on Solana, also backed Phantom’s point of view as it called its users to stay alert for suspicious links. 

Slope, a Web3 Navigator, also announced on their Twitter account that they are working closely with Solana Labs and other Solana-based protocols to find the source of the issue and resolve it. However, there has been no breakthrough yet.

There have also been various reports on how many accounts have been affected and the extent of the damage. According to Ava Labs CEO and Founder Emin Gur, the number was at 7,000 plus and rising at around 20 every minute. He further stated that the transactions seem to be signed correctly, implying that the attackers have access to the private associated with the affected accounts. 

Currently, the main discussion on social media is to protect against further damage, as many crypto experts advise SOL holders to transfer their assets to hardware wallets. During this period, Solana’s price also faced a bit of pressure causing its price to drop by 9% over the past few hours. However, it’s currently recovering, but further losses might be expected as Solana navigates through the situation.