Truflation Reports $5 Million Loss in Malware Attack on Blockchain Platform

TLDR

• Truflation, a blockchain-based inflation data platform, confirmed a malware attack
• Estimated losses range from $4.95M to $5.2M
• No customer funds or staking funds were compromised
• The TRUF token price dropped 15.6% shortly after the announcement
• Truflation is working with industry partners and law enforcement to address the incident

Truflation, a blockchain-based inflation data platform, has recently fallen victim to a malware attack resulting in significant financial losses.

The company, which is backed by notable investors including Coinbase Ventures and Chainlink, confirmed the security breach on September 25, 2023, through a post on the social media platform X (formerly Twitter).

On September 25th, 2024, the Truflation team detected some abnormal activity. An attacker launched an attack using malware.

We are currently monitoring the situation and are taking measures to protect funds while we are investigating and working with law enforcement. The…

— Truflation (@truflation) September 25, 2024

According to Truflation’s announcement, the team detected unusual activity that was later identified as a malware-based attack. The exact details of how the malware infiltrated their systems have not been disclosed.

In response to the incident, Truflation stated they are actively monitoring the situation and implementing measures to protect remaining funds.

The financial impact of the attack has been substantial.

Blockchain analyst ZachXBT estimates the total loss at approximately $5.23 million, with the majority of the funds, about $5.2 million, stolen from Truflation’s treasury multisignature and personal wallets on the Ethereum network.

An additional $100,000 was reportedly taken from wallets on seven other blockchain networks.

A separate assessment by blockchain security firm Cyvers places the loss slightly lower at $4.95 million. This figure includes about $3.89 million in Truflation’s native TRUF tokens, $1.07 million in Ether (ETH), and $236,000 in Dai stablecoin, all taken from the team’s Ethereum wallets.

Despite the significant loss, Truflation has assured its users that no customer funds were compromised in the attack. The company also confirmed that its staking funds remain unaffected, which should provide some reassurance to investors and users of the platform.

Truflation Price on CoinGecko

In the immediate aftermath of the announcement, the market reacted negatively to the news. The price of the TRUF token experienced a sharp 15.6% decline, dropping to $0.068 within 90 minutes of Truflation’s post.

The token has since partially recovered, trading at $0.073, with a market capitalization of approximately $12.8 million.

Truflation has stated that they are collaborating with “leading industry partners” and law enforcement to address the security breach.

In an unusual move, the project has also expressed openness to negotiating with the attacker, suggesting a potential willingness to explore a bounty or recovery agreement.

Truflation is reaching out to the wider blockchain security community, offering rewards for white hat hackers who can provide assistance in resolving the situation.

This approach highlights the increasing trend of cryptocurrency projects leveraging the expertise of ethical hackers to enhance their security measures and respond to attacks.

Launched in December 2021, Truflation has positioned itself as a provider of real-time economic and inflation data using blockchain technology.

The platform expanded its offerings in late 2022 by introducing a data marketplace that tracks various commodity indexes, including sugar, cocoa, coffee, cattle, petroleum, and wheat.