Bitcoin

Cypher Core Contributor Confesses to Stealing and Gambling $260,000 Recovered From Exploit

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An anonymous core contributor to the Solana exchange Cypher Protocol, known only as “Hoak,” has come forward with a confession.

The individual admitted to stealing and gambling approximately $260,000 worth of the project’s cryptocurrency, which had been recovered from a $1 million exploit that hit the platform last year.

Confessions and Stolen Crypto

The revelation was made through a public statement shared on May 14th via a post on X. “The allegations are true. I took the funds and gambled them away,” Hoak wrote in their public statement. “I didn’t run away with it, nor did anyone else.”

Hoax also acknowledged the impact of their actions on fellow Cypher contributor Barrett, who had initially exposed him.

“Barrett is definitely the person who was hurt the most throughout all of this, I know likely nothing I say or do will make things better – perhaps other than rotting in jail,” Hoak added.

In a separate post on X, Barrett disclosed evidence indicating that a wallet linked to Hoak had executed 36 transactions, withdrawing Ether, Bonk (BONK), Wrapped Solana (wSOL), and other cryptocurrencies totaling around $260,000 from Cypher’s redemption contract.

“I never thought this would be a possibility,” Barrett stated. “Having a core contributor who stayed on after the exploit to try and rebuild the project be the one who rugged funds from the redemption contract.” They also mentioned that they had notified law enforcement of Hoak’s actions.

Hoaks Public Statement

In their public statement, Hoak offered an account of their struggles, attributing the theft to a “crippling gambling addiction” and other “psychological factors left unchecked for too long.”

They expressed remorse for the harm inflicted upon personal and professional relationships, acknowledging their impact on those closest to them.

“After Project Citadel failed to get off the ground due to a lot of things happening with our personal lives, I was grounded for a bit, and things seemed to have gotten better, I’d found my footing with Cypher,” Hoak said in his public statement.

“I worked and worked, I tried to innovate within the DEX design space, I failed, I worked some more and I broke,” they added.

In August 2023, Cypher Protocol fell victim to an exploit, resulting in the theft of approximately $1 million worth of Solana (SOL) and USD Coin (USDC).

Despite this setback, the protocol successfully froze $600,000 worth of the stolen cryptocurrency. Following the incident, Cypher Protocol created the redemption contract and implemented a recovery strategy to reimburse affected users for their losses.

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