Kraken & CertiK Clash Over Bug Bounty
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Kraken has accused CertiK audit firm's security researchers of extortion after a vulnerability related to false deposits and withdrawals was found (June 9), where $3 million was extracted by CertiK as a pentesting procedure.
This was following an initial cooperation between the companies, only after CertiK's demonstrative extraction of funds did things get sour.
Soon after, Kraken's CSO Nick Percoco started coordinating efforts with law enforcement to recover funds.
CertiK defended against the allegations, saying that Kraken threatened its employees, that the funds value demanded back was mismatched, and that it had been given too little time to return the funds.
Prior to the public clash between both companies, the white hat hacker entity was not disclosed.
The vulnerability enabled the researchers to "steal" millions from Kraken's treasury, and the same vulnerability could enable the attacker to effectively print assets, according to Peroco.
Peroco also explained what white hat is, and said that the given bug bounty only disclosed $4 of stolen cryptocurrency.
It was also said by him that the researcher wouldn't return the funds until Kraken paid for the discovery. Hence the extortion allegations
CertiK concluded that Kraken's defense system is compromised on multiple fronts, and said that neither the wallet address was provided by Kraken for return, nor the time required to do it.
In addition, CertiK said they moved all the funds to an accessible account with Kraken.
Developer Uttam Singh, however, highlighted that the researchers waited 5 days before disclosure.
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