MoonNode, a validator on the Crypto.org network, downgraded and lost 5% of its total bound CRO after a hacker took over its infrastructure and doubled signed transactions.
As of July 9, the 5% slash had burned to about 450,000 CRO worth $25,500 in spot prices. The validator had nearly a 9 million CRO when the network imposed the double slash.
Crypto.org chain hacked, MoonNode validator snapped
The information was shared on Twitter by IcyCRO, the validator and Cosmos InterBlockchain Communication (IBC) relay for tokens such as cosmos (ATOM).
According to IcyCRO, Moonnode was hacked, and the hacker signed twice, resulting in the validator being “amazing.”
The cutting mechanism within the Crypto.org chain is different from other projects within the Cosmos ecosystem. While many other Cosmos chains impose downtime penalties, the Crypto.org chain applies an extended jail time of up to 24 hours. In this case, the double slash penalty resulted in a loss of 5% of the total bound CRO in the MoonNode.
MoonNode It is a verification service that allows users to participate in CRO and earn rewards. The service is operated by a company called Emrit. MoonNode had nearly 9 million CRO hostage.
With the 5% double-signing penalty applied, the auditor lost nearly 450k CRO, which was burned. Notably, the MoonNode’s largest delegate, who had about 1 million CROs held hostage, lost 50,000 CROs from his stake.
This was not the only cost incurred in the breach. When a validator is jailed for excessive downtime or double signature blocking, it is temporarily removed from the validation process.
Validators need to initiate a manual transaction known as an “unjail” transaction to join the validation process after the 10-minute jail time has elapsed. During this jail time, the validator cannot participate in validating transactions or earn rewards, resulting in a massive loss of opportunity cost.
The importance of due diligence
Validators play an important role in blockchain networks by validating transactions and maintaining the integrity of Proof-of-Stake (PoS) networks and blockchains that use a variable system of consensus system.
The MoonNode incident highlights the importance of maintaining security and adhering to network rules. It also serves as a reminder for delegates.
(embed) https://www.youtube.com/watch?v=ngAT8ToWZ8I (/embed)
According to IcyCRO, auditor selection and fund allocation should not be based on funny names or memorable puns. Delegates should carefully evaluate auditors’ reputation, performance, and security measures before delegating funds.
As of July 9, CRO prices are stable on the last day but down more than 50% from the previous 12 months. At the time of publication, each coin is trading at $0.056.