Solana multisig provider conducting ‘comprehensive review’ after Safe exploit
“High value accounts” need purpose-built wallet solutions because sophisticated hackers can “potentially compromise any frontend,” Squads CEO told Blockworks
Artwork by Crystal Le
This is a segment from the Lightspeed newsletter. To read full editions, subscribe.
Yesterday, Bybit CEO Ben Zhou posted on X that the platform’s $1.4 billion hack had been caused by “malicious code originating from Safe{Wallet}’s infrastructure.” Solana CEOs had many words, including “nightmare season,” “holy hell,” and “holy shit.”
Preliminary reports indicate Safe’s frontend was exploited to trick Bybit into signing a malicious transaction, and Safe’s actual smart contracts appeared to perform as intended. Still, the foul language likely stemmed from the fact that wallets being exploitable gives hackers access to a whole lot of assets — Safe’s smart accounts secure over $100 billion in digital assets.
In other words, hackers could go further than Bybit.
Squads, a multisig wallet used by a number of prominent Solana teams including Helium, Kamino, Pyth, Helius, Drift, Jupiter and Ellipsis, is “conducting a comprehensive review of our infrastructure to mitigate the possibility of such an attack,” CEO Stepan Simkin told me.
Simkin emphasized that “high value accounts” need purpose-built wallet solutions because sophisticated hackers can “potentially compromise any frontend.”
The Bybit hackers — whom the FBI has now accused of being linked to North Korea — injected malicious code into Safe’s JavaScript files to alter Bybit’s multisig transactions and send the funds to the attacker’s address, according to a report from blockchain security firm Slowmist. While the crypto industry puts a lot of effort into auditing smart contracts, it focuses less than it should on “conventional infrastructure” — like leaked Amazon Web Services credentials, which was the culprit in this case, Simkin said.
“JavaScript side hacks are the easiest to execute due to lack of audits,” Cube Exchange CEO Bartosz Lipinski said. “Solana is not immune to that.”
Lipinski said Cube chose multi-party computation over multi-signature for wallet security in part because it prevents “blind signing “ — which Bybit apparently did.
Simkin said Squads is working on a “decentralized frontend” that would allow users to interact with the protocol without having to rely much on its infrastructure.
Get the news in your inbox. Explore Blockworks newsletters:
- Blockworks Daily: Unpacking crypto and the markets.
- Empire: Crypto news and analysis to start your day.
- Forward Guidance: The intersection of crypto, macro and policy.
- 0xResearch: Alpha directly in your inbox.
- Lightspeed: All things Solana.
- The Drop: Apps, games, memes and more.
- Supply Shock: Bitcoin, bitcoin, bitcoin.
