The latest face-saving communique from Seychelles-domiciled crypto exchange KuCoin – hacked almost two months ago for over $280 million – is that 84% of the affected assets have been recovered. Some victims will be glad the situation seems to be moving towards resolution. Others, not so much.
Leaving aside the conspiracy theories, death threats and alleged lack of communication on the part of the exchange, the KuCoin debacle raises troubling issues around blockchain decentralization and how token projects often rely on fallible intermediaries.
Following the hack, many projects whose tokens were stolen from the exchange were urged to react quickly and change their smart contracts – effectively replacing stolen tokens with new versions, known as a token swap. (A list of projects that speedily updated their tokens following the Sept. 26 hack can be found here.)
The majority of ERC-20 projects affected by the KuCoin hack (around 60%) have bowed to pressure and upgraded