Why is popular cryptocurrency Solana crashing

The world of cryptocurrency has faced another cyber attack and this time it would be Solana who is on the suffering side. The digital token Solana crashed on Wednesday as the decentralized system is reported to be a casualty of a multimillion dollars hack. Solana witnessed a selling pressure on exchanges after users reported about their funds getting drained without their knowledge from their “hot” wallets including Phantom, Slope, and TrustWallet. The issue is still ongoing. Solana is estimated to have witnessed a loss of $8 million.

On CoinMarketCap, Solana is trading at $39.37 down by 2.24%. The token’s market cap is around $13.65 billion. The token has touched an intraday high and low of $42.33 and $38.28 respectively.

Solana is the ninth largest cryptocurrency currently following Cardona which is at eighth rank.

Compared to its all-time high of $260.06 in November last year, Solana has nosedived by nearly 85%.

Talking about the Solana hack, Sathvik Vishwanath, Co-Founder, and CEO of Unocoin said, “Solana is a new blockchain supported by a token of its own that works as the gas to confirm the transactions on that blockchain. There have been numerous hacks on the wallets supporting this token. A recent successful attempt drained away about 560M USD worth of Solana from various user wallets and this has sent shivers in the Solana ecosystem. A part of the reaction is the decreased prices of the token.”

According to the PeckShieldAlert report, the widespread hack on Solana wallets is likely due to the supply chain issue exploited to steal/uncover user private keys behind affects wallets. So far, the loss is estimated to be $8 million, excluding one illiquid shitcoin (only has 30 holds & maybe mis-valued $570 million.

Solana users have been reporting on Twitter about their funds being drained without their permission and knowledge.

Its not just Solana, Ethereum users too faced a similar issue.

PeckShieldAlert revealed that seems like before Solana Wallets got drained, a user’s TrustWallet and Slope wallets have been compromised on both Solana and Ethereum.

Further, Prashant Kumar, founder, weTrade said, “Solana seems to be witnessing an ongoing hack in which hot wallets are being compromised. The initial signals point to compromised keys which are evident by the digital footprints which are apparently signed by the respective owners.”

Kumar added, “One of the key things to learn through this is to ensure 100% privacy of the private keys and some users have started to move their coins to hardware wallets. Solana with the other cryptocurrencies have been generally moving upward for the last few weeks. However, the hacking news led to price erosion first but it has partly restored the lost value since then!”

Solana is the fastest blockchain in the world and the fastest growing ecosystem in crypto, with thousands of projects spanning DeFi, NFTs, Web3 and more. Headquartered in Switzerland, Solana Foundation official launched Solana in March 2020. Anatoly Yakovenko is the founder of Solana.

Catch all the Business News, Market News, Breaking News Events and Latest News Updates on Live Mint.
Download The Mint News App to get Daily Market Updates.


Subscribe to Mint Newsletters

* Enter a valid email

* Thank you for subscribing to our newsletter.

First article

Leave a Reply

Your email address will not be published.