FTX, a Bahamas-based cryptocurrency exchange established in 2019 by Sam Bankman-Fried, is reportedly willing to compensate investors affected by the phishing attack.

According to the extensive Twitter thread shared by FTX founder and CEO Sam Bankman-Fried, a few FTX users registered to the fake 3Commas website and became phishing attack victims.

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Blockchain journalist Colin Wu used Twitter to share the news about the attacks. The journalist claimed that one user noticed that their “FTX account using the 3Commas API was trading DMG more than 5,000 times.” The attacker has reportedly stolen $1.6 million in cryptocurrencies, such as Bitcoin (BTC), Ethereum (ETH), FTX Token (FTT), etc.

After the attack, FTX informed the user that the exploit was caused by the 3Commas’ application programming interface (API) KEY leak.

On October 23rd, 3Commas shared its security update claiming that the phishing attack was conducted through “inauthentic websites” depicting 3Commas interface. According to 3Commas, three users revealed to be affected by this attack. In its update, the company added:

3Commas, in cooperation with our partner exchanges, is conducting an investigation of this incident to ensure our user community remains protected and feels safe to trade. We are working directly with the three individuals who claim to have been affected so that we can ascertain more details regarding how they stored their API keys and other sensitive data.

In response to the news, FTX CEO Sam Bankman-Fried used Twitter to announce that attacked FTX customers are set to receive compensation. However, the CEO emphasized that it is only a one-time thing, and FTX will not continue compensating users affected by the shortcomings of other companies. 

It is not the first time this month that investors are losing money during numerous crypto company exploits. In fact, the crypto community went as far as to call October a “hacktober.” The data shared by Chainalysis revealed that October has been the “biggest month” for hacking activities. Chainalysis data showed that from the beginning of the month until October 13th, hackers stole around $3 billion from over 125 separate incidents involving crypto.

by Gile K. – Crypto Analyst, BitDegree