Animoca Brands Subsidiary Loses $18 Million in a Hot Wallet Hack

Animoca Brands subsidiary, Lympo, an NFT platform that specializes in the minting of sports-related collectibles, has lost $18 million to a hack of several of its hot wallets.

According to a Medium post that announced the breach of security, the team stated that it lost 165.2 million LMT tokens after a hacker gained access to the main operational wallet of its subsidiary, Lympo. It added that 10 projects that are collaborating with Lympo were compromised in the attack.

The hacker then swapped the stolen tokens for ETH at Sushiswap and Uniswap before sending them to an unidentified wallet, apparently after mixing them at a cryptocurrency tumbler.

LMT Price Tumbles Following the News

LMT lost 92% of its value, dropping to $0.0093 after it became apparent that a hacker had gained access to the tokens. The team later sent out a tweet to its community on January 11, stating that they were working to ensure that the platform is stabilized to ensure that operations are resumed.

As a remedial measure, they added that LMT has been removed from liquidity pools to avoid unnecessary disruptions to the price of the token. With the suspension of its liquidity pool, large volume orders made by traders won’t be filled promptly, and such orders are not without significant losses to the trader. This implied that it is best to suspend trading on assets with low liquidity if the order is of a substantial volume.

According to the tweet:

Lympo provides an update on the LMT token slippage and hacking that occurred on January 10th at approximately 12:32 pm UTC. We’re working on stabilizing the situation and resuming all operations back to normal.

Animoca Supports Lympo For Recovery

In an announcement on January 11, the Lympo team advised traders to avoid trading the LMT token until they decide on the best route to take after investigating the cause of the security breach on the wallet.

Sequel to the hack, Animoca, the parent company of Lympo, stated that it would give necessary support to Lympo to enable the NFT platform to surmount the challenges associated with the attack. The CEO of Animoca, Yat Siu, in a statement to the press, said:

 “We are working with Lympo to assist them on a recovery plan, but we don’t have any specific mechanisms.”