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The $1.5B Bybit Hack

blog.trailofbits.com

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Re: The $1.5B Bybit Hack

#121

Post by fc417fc802 »

acdha wrote: post #120
fc417fc802 wrote: post #108

Earlier quoted context omitted.

An algorithmically enforced settlement period where the final result of the entire transaction is visible on the chain but reversible by either party doesn't seem like it would run against that ideology.

No, but it’s a lot more work and it undercuts the marketing claims about being faster. If the industry grows up, I’d expect to see things like that happen.

Opt-in wouldn't affect speed. If mandatory, make it log10( thousands ) hours. I'm sure you can afford to wait 4 hours for a million dollar transfer to clear. Bybit would have had 7 hours to realize and revert the mistake in that case.

Re: The $1.5B Bybit Hack

#122

Post by greg7mdp »

alwa wrote: post #63
m3kw9 wrote: post #10

Earlier quoted context omitted.

They should only use a computer that is air gapped to go online only when signing something. This is an op sec failure to not have this procedure

Why should it go online at all? $1.5 billion buys a lot of plane tickets to the same physical place, and how frequently do they need to be accessing the whole lump, anyway? For that matter, I know signatures are long and human-unfriendly, but isn’t it on the order of a couple hundred bytes? Surely $1.5 billion buys transcribing the putative signature request into an isolated machine in a known state, validating/inter…

What you should do is sign the transaction on an offline computer (which is booted from a linux OS on a flash drive with only the essential software), simulate the transaction to verify it does what you expect, and then save the signed transaction to a flash drive. Then you can submit your transaction on a connected computer with confidence that you didn't sign your tokens away to someone else.

Re: The $1.5B Bybit Hack

#123

Post by greg7mdp »

__turbobrew__ wrote: post #38
Mistletoe wrote: post #3

My understanding is this multisig failed because, like most security, everyone just pressed yes and didn’t communicate, investigate, or ask questions, defeating the purpose of a multisig.

Yea, how is it that multiple people signed a transaction for over a billion dollars of assets without due diligence? If you did this for non crypto there would be lawyers, bankers, etc involved in the transaction. Root certificate authorities have already solved this problem with signing rituals which take place in person in an air gapped vault on specialized hardware and multiple parties as witness.

They didn't sign a transaction for 1 billion dollars. They all signed what they thought was a routine transfer, but in reality what they signed gave the hacker full control of the smart contract (the Gnosis Safe) in which the 1.4B $ of tokens were stored.

The hackers, having gained control of the smart contract, proceeded to empty it of funds.

Re: The $1.5B Bybit Hack

#124

Post by greg7mdp »

wslh wrote: post #4
Mistletoe wrote: post #3

My understanding is this multisig failed because, like most security, everyone just pressed yes and didn’t communicate, investigate, or ask questions, defeating the purpose of a multisig.

The concept of strong safeties was not in place. Safeties refer to layers that go beyond common trust mechanisms. In this case, signing a transaction of that magnitude solely based on multi-signature approval was completely insufficient. There should have been additional safeguards, such as special approvals and extra verification steps, specifically designed for transactions within that amount range.

They didn't sign a transaction for 1 billion dollars. They all signed what they thought was a routine transfer, but in reality what they signed gave the hacker full control of the smart contract (the Gnosis Safe) in which the 1.4B $ of tokens were stored. The hackers, having gained control of the smart contract, proceeded to empty it of funds.

Re: The $1.5B Bybit Hack

#125

Post by FabHK »

ohwowhi wrote: post #9

Unsure why the title says this era has arrived as if it's something new. As an internal penetration tester, I can attest it's already a disaster. The issue is that companies live and die by the cope that social engineering is a high bar or that if a vulnerability isn't internet facing, it's not a big deal.

The point of the article seems to be that it used to be bugs and raw incompetence, and now it's graduated to insufficient OpSec. Significant progress for crypto.

Re: The $1.5B Bybit Hack

#126

Post by FabHK »

victorbjorklund wrote: post #22
tremarley wrote: post #16

Earlier quoted context omitted.

Reversible transactions is a feature for fiat money Reversible transactions would generally be a bug regarding cash & hard assets of which cryptocurrency is trying to imitate.

1.5 billion in cash would not disappear this easy. You would need trucks to even transport it.

Indeed. If you sell a suitcase of cocaine, you need to launder two suitcases of cash.

Re: The $1.5B Bybit Hack

#127

Post by celticninja »

acdha wrote: post #119
celticninja wrote: post #116

Earlier quoted context omitted.

ok but in practice having multiple signatures but one signer is pointless, so multi-sig pretty much does mean multiple signers(people)

Sure, but I mention it because it’s not a 1:1 mapping and if they aren’t rigorously auditing their behaviour it wouldn’t exactly be unheard of for people to know coworkers passwords or, more likely, for most of them to just trust someone saying it’s legit. If the tweet about it being a smart contract update is accurate, it’d be especially plausible that people shirked their responsibility and just approved it without…

I think the article is clear that the attribution to NK was done by independent 3rd party blockchain researchers and not from ByBit.

The article is also pretty clear about the method that was used to compromise ByBit and how it has evolved from previous hacks on cryptocurrency exchanges.

Sometimes it really is a nation state actor, and whilst it may be a stretch to blame a threat actor of this level if your user data was stolen, this is 1.5bn in fungible cryptocurrency, just the sort of thing a pariah state requires and can launder with minimal risk of arrest or any judicial action really.

Re: The $1.5B Bybit Hack

#128

Post by freehorse »

celticninja wrote: post #111
acdha wrote: post #68

Earlier quoted context omitted.

According to that page, the global reaction was to block most ($850M) of the fraudulent payments, recover a third of the remainder, add additional security to the SWIFT network and raise standards for banks, and push for penalties for the criminals who participated. That seems like more than a shrug.

And we are likely to see the same response here. Those coins are easily tracked, so the attacker is going to be lucky to get 25% of the value by selling them to someone prepared to take the risk of laundering them.

A crypto exchange does not have the same political influence as a national bank, which makes the situations very different, aside from all crypto stuff.

Re: The $1.5B Bybit Hack

#129

Post by dmichulke »

They specifically name MacOS and Windows, so it is something about their network's and their computer's security?

Have the signing devices been iOS or Android phones?

Shouldn't a signing device be (in such a case) used for signing only, e.g. a QR-Code signer with no OS that specifically shows the inputs and outputs to the transaction?

Re: The $1.5B Bybit Hack

#130

Post by jgilias »

fc417fc802 wrote: post #109
jgilias wrote: post #103

Earlier quoted context omitted.

Separate keys for what? They believed they were signing a routine transaction. That’s the whole idea of the hack. Splitting funds over 100 wallets would’ve helped. A 100x lower amount would be lost. And/Or having separate hardened devices used only for signing.

Separate keys (ie wallets) for routine small transactions versus the cold wallets used for huge sums. Perhaps I've misunderstood but it sounded like they performed a rare transaction while being led to believe it was a routine one. I'm wondering why you wouldn't split the infrastructure given the differences in risk.

Sorry, yeah, I misunderstood what you meant! Splitting funds more would’ve been a good idea. And being paranoid about _any_ transaction touching the “big-pot” wallet too!
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