FTX will compensate phishing victims with $6M

FTX CEO offered to award compensation to users who fell for recent phishing attacks. He stressed, though, that it's a one-time offer.

Open padlock with a hole

Sam Bankman-Fried offered $6 million compensation for the victims of the recent phishing attack. The FTX founder and CEO stressed in a lengthy Twitter thread that this was a one-time offer and definitely "NOT A PRECEDENT".

On October 21, a blockchain reporter Colin Wu informed about a new method for siphoning off assets from centralized exchanges called "Contra Trading." The scheme was used to steal $1.6 million in cryptocurrencies, including Bitcoin, Ether, and FTX token (FTT), from an unnamed user that contacted Wu two days earlier.

The hackers targeted the victim's FTX account using 3Commas API. The victim reported the theft, but the exchange denied any responsibility and blamed a leak in the 3Commas API Key. As it occurred later, there were more victims of the attack. All of them were stolen from via "unauthorized contra trades."

Bankman-Fried, in his yesterday's post, declared that FTX has "a huge number of controls in place to attempt to prevent fake FTX sites from being able to drain users' accounts" and that "generally they work." He also reminded that "phishing is almost always a case where the user voluntarily (but unknowingly) gives their account credentials to a scammer by going to a bad site or something like that."

He added that FTX managed to "mostly" stamp out impostor sites masquerading as FTX.