Incident Overview
Peer-to-peer bitcoin marketplace LocalBitcoins suffered a hack that resulted in the distribution of malware and a loss of customer funds.
will be granted refunds after taking steps to address security vulnerabilities, according to the company.
Vice president Nikolaus Kangas explained:
“The attacker used that LiveChat access to spread some kind of Windows executable, which probably was some new kind of keylogger software which is not yet detected by virus protection mechanisms. If the user got that executable installed, with some social engineering, the attacker managed to get access to different accounts of those victims.”
LocalBitcoins estimated 17 BTC lost from customer wallets.
Incident Report
Protocol Information
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 LocalBitcoins, these are the critical security checks that could have prevented this incident (January 2015).
- 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 TrialFunds Recovery
Recovered
$4K
Net Loss
0
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 LocalBitcoins
The LocalBitcoins 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.