EigenLayer, a protocol known for its restaking techniques that extend Ethereum’s security beyond the blockchain’s base layer, has become yet another crypto-related victim of a social media takeover.
Early Friday morning ET, Eigen Layer’s X account was taken over by a malicious actor and began posting what turned out to be phishing URLs to lure crypto users in with the prospect of a token airdrop allocation.
“The @EigenLayer handle has been compromised. Please do not engage with any suspicious links and actively double check and verify you are engaging with ‘eigenlayer.xyz,” wrote Eigen Labs, the software firm behind the restaking protocol, on X. “An update will be provided once secured.”
Nader Dabit, director of developer relations at Eigen Labs, also said, “We are actively investigating [the situation].” As of the time of publication, EigenLayer’s X account was not showing any tweets. A spokesperson for Eigen Foundation did not immediately respond to Unchained’s request for comment for this story.
According to Scam Sniffer, one crypto user lost $800,000 as a result of the attack, which the security firm said had likely stemmed from the victim clicking on a phishing link.
EigenLayer is hardly alone in having its X account compromised by nefarious crypto actors. Just this week, FBI agents arrested a 25-year-old Alabama man in connection of the January 9 hack of the SEC’s X account. Once the man and his co-conspirators had gotten control of the account, they falsely announced that the agency had approved the trading of spot bitcoin ETF’s, the FBI alleged, causing bitcoin to immediately spike more than $1,000. And scammers have previously taken over the accounts of other prominent crypto-related figures and organizations to announce false information.
Denting EigenLayer’s Reputation
The recent security breach of EigenLayer’s X account is threatening the protocol’s image, with several observers pointing to previous challenges. “EigenLayer is selling you its 11 [billion] TVL as shared security but can’t even secure their own twitter account,” said @0xBalloonLover. Another crypto user @Yashhsm wrote, “Ironically, EigenLayer claims to be a ‘verifiable cloud,’ yet they can’t properly handle insider token sales, employee airdrops, Twitter accounts, and what not.”
On Oct. 4, EigenLayer revealed that one of its investor’s transfer of tokens into custody was compromised by a malicious actor, prompting protocol team members to contact law enforcement. The incident resulted in the theft of roughly 1.7 million EIGEN tokens, worth about $6 million at current prices.
Read More: EigenLayer Says $5.5 Million Hack From ‘Compromised’ Email Thread Is An ‘Isolated Incident’
In addition, Aug. 2024, CoinDesk reported that Eigen Labs shared a list of employee’s wallet addresses with other projects planning to launch tokens. In response, EigenLayer published a blog post emphasizing how there was no evidence of Eigen Labs employees pressuring other teams “to unduly benefit” from potential airdrops.
EIGEN, the protocol’s native token has increased 1.6% in the last hour and 13.6% in the past 24 hours to trade at $3.57, giving it a market cap of over $667 million. The number of total cryptocurrencies deposited into EigenLayer currently stands at $11.1 billion, making it the third largest protocol by total value locked, trailing only liquid staking provider LIdo and lending platform Aave.
