Crypto Gambling Site Stake Sees $41M Withdrawals in Possible Hack

Imagine waking up one day to find out that millions of dollars have been drained from your gambling account. That's exactly what happened to users of the popular crypto gambling site, Stake. On September 4, 2023, a staggering $41 million was withdrawn from the platform, leaving many in shock and disbelief.

The incident has been labeled as a "suspicious outflow" by blockchain security analysts. The withdrawing account, named "Stake.com Hacker" on Etherscan, suggests that a stolen private key may be the cause of the drained funds.

From Ethereum to Polygon, and even on Binance Smart Chain (BSC), the hacker targeted multiple chains. The losses amounted to approximately $15.7 million in Ethereum, $7.8 million in Polygon, and $17.8 million in BSC. In total, a staggering $41.35 million was drained from the platform.

Interestingly, the alleged attacker managed to distribute the stolen funds to multiple accounts after the heist, making it even more difficult to trace and recover the funds.

How It Happened

Blockchain data reveals that the attacker executed a series of large withdrawals from the Stake.com contracts into their own account. The first transaction occurred at 12:48 pm and involved approximately $3.9 million worth of Tether (USDT), a stablecoin, being transferred out of Stake and into the attacker's account.

Subsequently, two additional transactions were made, totaling 6,001 Ether (ETH), valued around $9.8 million. The attacker continued to drain the platform of its tokens, including over a million dollars worth of USD Coin (USDC), nearly a million dollars of Dai (DAI), and 333 Stake Classic (STAKE). In total, an estimated $16 million worth of crypto was drained.

Stake's Response

Stake quickly confirmed the hack via social media, stating that unauthorized transactions had been made from their ETH/BSC hot wallets. However, they reassured their users that their funds were safe and that they were actively investigating the issue.

According to Stake co-founder Ed Craven, the platform keeps only a small portion of its crypto reserves in hot wallets at any given time. This precautionary measure ensures that even in the event of a hack, the losses would be minimal and wouldn't affect users.

A Disturbing Trend

Unfortunately, this is not the first crypto gambling hack of its kind in 2023. Back in July, Alphapo, a payments provider for several gambling sites, lost a staggering $31 million to suspicious withdrawals. It seems that hackers are increasingly targeting these platforms, highlighting the need for enhanced security measures within the industry.

As the investigation into the Stake hack continues, it serves as a stark reminder for all crypto users to remain vigilant. Safeguarding private keys and using reputable platforms are essential steps to protect oneself from such incidents.

"Remember, not your keys, not your crypto," a popular saying in the crypto community, has never been more relevant.

The Future of Crypto Gambling

Despite these unfortunate events, the popularity of crypto gambling continues to rise. Platforms like Stake offer a wide range of games, including dice, blackjack, and sports betting, attracting users from around the world.

With the growing demand for crypto gambling, it is imperative for platforms to prioritize security and implement robust measures to safeguard users' funds. By doing so, they can instill confidence in their users and ensure the long-term viability of their platforms.

In the face of potential risks, it is essential for the crypto gambling industry to adapt and evolve, making security their top priority. Only then can users truly enjoy the benefits and excitement of this emerging form of entertainment.

Update (September 4, 2023, 10:03 p.m. UTC): This article has been updated to include a report from Beosin claiming that $41 million was lost instead of only $16 million.