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A hacker who exploited the KiloEx decentralized exchange for $7.5 million has returned all stolen funds just four days after the incident. The exchange, which suspended operations following the April 15 attack, confirmed the recovery of the funds on April 18, following a bounty offer to the hacker.
Key Takeaways
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KiloEx lost $7.5 million due to a price oracle exploit on April 15.
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The hacker returned all funds after KiloEx offered a $750,000 bounty.
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KiloEx will not pursue legal action against the hacker, considering the incident resolved.
The Attack on KiloEx
On April 15, 2025, KiloEx, a decentralized exchange (DEX), fell victim to a sophisticated hack that exploited a vulnerability in its price oracle system. The attacker manipulated the price data used by the exchange to execute leveraged trades at artificially inflated prices, resulting in a loss of $7.5 million.
The exploit involved the attacker using a wallet funded through Tornado Cash, a privacy-focused Ethereum mixer, to obscure their identity. By altering the ETH/USD price feed, the hacker was able to purchase Ethereum at a significantly reduced price and sell it for a much higher value, executing this strategy across multiple blockchains.
KiloEx's Response
In response to the breach, KiloEx immediately suspended trading and launched an investigation in collaboration with cybersecurity firms and law enforcement. The exchange also announced a bounty of $750,000, equivalent to 10% of the stolen amount, if the hacker returned at least 90% of the funds.
KiloEx's official communication stated:
"We are actively monitoring your addresses and intend to freeze the stolen funds promptly."
This proactive approach aimed to encourage the hacker to return the funds while also ensuring that the exchange could recover from the incident without further losses.
Recovery of Funds
On April 18, just four days after the hack, KiloEx announced that the hacker had returned all stolen funds. Blockchain security firm PeckShield confirmed that approximately $5.5 million had been transferred back to KiloEx-linked addresses, and shortly thereafter, the exchange reported the full recovery of the funds.
KiloEx выразила благодарность за возврат средств и заявила, что выполнит предложение о вознаграждении, признав действия хакера дей
KiloEx expressed gratitude for the return of the funds and stated that it would honor the bounty offer, recognizing the hacker's actions as those of a white hat, or ethical hacker. The exchange noted:
"With all affected funds fully restored, we are fulfilling our pledge to resolve this matter fairly and transparently."
Moving Forward
Following the recovery, KiloEx has committed to enhancing its security measures to prevent future exploits. The exchange has stated that it will not pursue legal action against the hacker, viewing the resolution as a positive outcome for all parties involved.
This incident highlights the ongoing challenges faced by decentralized finance platforms regarding security vulnerabilities. As the crypto landscape continues to evolve, the need for robust security protocols becomes increasingly critical to protect user assets and maintain trust in the ecosystem.
In conclusion, the KiloEx hack serves as a reminder of the risks associated with decentralized exchanges and the importance of ethical hacking in identifying and resolving vulnerabilities. The swift recovery of funds and the cooperative approach taken by KiloEx may set a precedent for how similar incidents are handled in the future.
Sources
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Hacker Returns $7.5M To KiloEx Following Bounty Offer, FinanceFeeds.
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KiloEx Exchange Recovers $7.5M as Hacker Gives Back Stolen Funds, Coinspeaker.
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KiloEx exchange exploiter returns all stolen funds after $7.5M hack, Cointelegraph.
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KiloEx recovers all stolen funds from April hack, confirms case closure | CryptoTvplus, CryptoTvplus.
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KiloEx Hacker Returns Entire $7.5M Four Days After Exploit, Cryptonews.
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