A “decentralized autonomous organization” called CityDAO was hoping to turn 40 acres in Wyoming into a “cryptocurrency city” — but their plans have now been targeted by hackers who successfully got away with members’ funds.
The incident is yet another reminder that cryptocurrency technologies may be relatively secure in and of themselves, but the software used by their communities — in this case Discord —remains to be as vulnerable to hackers as ever.
“EMERGENCY NOTICE,” a Twitter update by the group poste on Monday reads. “A CityDAO Discord admin account has been hacked. THERE IS NO LAND DROP. DO NOT CONNECT YOUR WALLET.”
CityDAO claimed in November to have become the first DAO to officially own land.
“This parcel is a proof of concept parcel — it’s not in the most convenient location nor does it have an abundance of natural resources,” the group tweeted at the time. “It does have a well for water, a flat area for building, and is 45 minutes from an airport.”
“Each parcel of land is an NFT that can be owned collectively by the DAO collectively or by individuals,” reads CityDAO’s website. The goal of the city is to “build the future of real estate ownership on chain with Solidity and Web3” — and of course “make dank memes.”
DAOs have skyrocketed in popularity in the past year or so, promising community members equally divided representation as a way to be a part of a larger project.
For instance, ConstitutionDAO recently attempted to purchase an original copy of the United States Constitution with $40 million in crypto last year — before being outbid by a hedge fund billionaire.
But the cracks are starting to show. Hackers saw an easy target in CityDAO and managed to gain access to an admin Discord account and make a fake “land drop” from the compromised account. The infiltrator — or infiltrators — reportedly got away with $95,000 worth of Ethereum.
One CityDAO victim tweeted on Tuesday that the attack was “a ridiculous security breach from Discord” that allowed the hacker to “bypass two-factor authentication and password.”
“I ask everyone to please be extremely careful when clicking on links in servers, connecting your wallets to applications and just activities online in general,” they added in a follow-up tweet. “We are trying our best to resolve the issue in the best outcome possible so please bare with us.”
The incident likely won’t be the last. Less than a month ago, different scammers pulled off a similar hack, points out, getting away with around $150,000 in crypto.
Those interested to get into the DAO space should watch their backs, in other words. With all the attention they’ve been getting, hackers are starting to circle like sharks.
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