Incident Overview
Gatecoin experienced a cyberattack on its hot wallets that resulted in the loss of funds. A new update from the exchange team indicated that as much as $2m was lost.
Gatecoin has claimed that it lost as much as 185,000 ethers and 250 bitcoins, an amount worth roughly $2.14m at press time.
Gatecoin said in a statement:
"We have previously communicated the fact that most clients’ crypto-asset funds are stored in multi-signature cold wallets. However, the malicious external party involved in this breach, managed to alter our system so that ETH deposit transfers by-passed the multi-sig cold storage and went directly to the hot wallet during the breach period. This means that losses of ETH funds exceed the 5% limit that we imposed on our hot wallets."
Incident Report
Protocol Information
Market Context at Time of Hack
What the Attacker Needed to Succeed
Understanding the prerequisites for this type of attack helps auditors identify protocols that are most at risk and helps developers build better defenses.
What Auditors Should Check
If you're auditing a protocol with similar architecture to Gatecoin, these are the critical security checks that could have prevented this incident (May 2016).
- Verify all logic paths related to Access Control are guarded by proper access controls and input validation - see the Access Control Attacks attack class for patterns
- Review privileged functions (owner, admin, governance) for potential abuse vectors - centralization risks should be documented and bounded with timelocks or multi-sigs
Master these auditing techniques with hands-on labs and real exploit scenarios in the Smart Contract Hacking course.
Free TrialSecurity Audit History
- Audit Report 1 Report
Related Attack Classes
The technique used in this hack maps to these vulnerability classes in our security curriculum:
Sources & References
Learn to Prevent the Next Gatecoin
The Gatecoin hack is one of many attacks that skilled auditors are trained to detect before deployment. Master real exploit patterns and defense techniques with hands-on Web3 security training.