Tornado Cash government token holders will soon regain control over the protocol’s operations, thanks to an unexpected proposal put forward by the attacker.. This advance allows the community to regain authority and direct the protocol towards recovery and improved security measures.
On May 26, the proposal to return control to tokenholders of the original governance of Tornado Cash was successfully approved. A total of 517,000 tokens voted in favor of the proposal, with none opposing it. This resolution quickly puts an end to a governance takeover that fortunately did not affect the protocol itself, but did lead to the theft of specific governance tokens.
Successfully orchestrating a takeover of the protocol’s governance system, the attacker engineered a malicious proposal that netted him 1.2 million votes. Leveraging this significant voting power, they passed other proposals and ultimately gained control of the previously acquired governance tokens. Their tactics allowed them to manipulate the government structure, resulting in a transfer of authority in their favor.
In a shocking turn of events, just hours after the hack, the attacker unexpectedly contacted the Tornado Cash community, presenting a proposal purportedly aimed at restoring governance control. This unexpected gesture surprised many, arousing curiosity and prompting further scrutiny of the attacker’s intentions and motivations.
According to Martin Lee, a data journalist at cryptocurrency analytics site Nansen, the attacker got steal 483,000 Tornado Cash (TORN) tokens. Subsequently, they carried out a series of redemptions, converting the majority of the stolen tokens into 485 Ether (ETH), with an approximate value of USD 890,000. This strategic move left them with 39,000 TORN, valued at about USD 160,000. To hide the origin of the funds, a portion of the ETH was cleverly routed through Tornado Cash, adding an additional layer of anonymity to the transaction.
Tornado Cash, the Ethereum blockchain-based cryptocurrency mixing service, was embroiled in controversy when it was officially sanctioned by the US Treasury in August 2022. The sanctions stemmed from allegations that the protocol had been used for money laundering.
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