Incident Overview
Titanium Blockchain Infrastructure Services is a project whose CEO was engaged in securities fraud, the investigation of which was handled by the SEC.
TBIS CEO has pleaded guilty to cryptocurrency fraud in the Central District of California related to the ICO of the project, which raised approximately $21M. He admitted that in order to attract investors, he falsified some aspects of official TBIS documents. He also posted fake customer reviews on the TBIS website and falsely claimed that he had business relationships with well-known companies in order to create a false appearance of legality. Like most blockchain projects, TBIS outlined its plans in a whitepaper, promising that its BAR token would be useful for accessing a platform offering real services. TBIS stated that there was a major hack of BAR, and issued a second coin, TBAR, to replace it. However, the original BAR coin continued to be traded on exchanges.
Titanium was one of several ICO projects that attracted fraud allegations around 2017 and 2018 during a surge in coin-based fundraising, and the SEC even created its own fake website to warn buyers about the fraud. Today, most of the alleged fraud is related to projects of non-interchangeable tokens or NFT, but the legal system is still catching up with ICOs. Stollery is due to be sentenced in November 2022, where the fraud charge carries a maximum 20-year prison sentence.
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 TBIS, these are the critical security checks that could have prevented this incident (July 2022).
- Verify all logic paths related to Rugpull are guarded by proper access controls and input validation
- 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 TrialSources & References
- 01
- 02
- 03
- 04
- 05
-
06
Source 6 https://www.coindesk.co
Learn to Prevent the Next TBIS
The TBIS 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.