In what sounds like a case of gross negligence, Nomad, a new start-up in the cryptocurrency space, lost $190 million in a series of hacks. But in this instance, calling it hacks is being too nice. Usually, hackers require skills and strategies that take time and effort to execute.
Apparently, in Nomad’s case, the attacks were a “free-for-all” crypto spree where anyone, even people with no prior IT skills, could seize on the platform’s shortcomings and withdraw crypto from its accounts. To make matters worse, the hackers could even withdraw more that was available in the accounts.
If you’re baffled like we are, grab onto your socks and keep reading to learn more about what might have transpired at Nomad.
What is Nomad Crypto Startup?
Nomad is a crypto wallet or bridge that lets you transfer crypto from one blockchain network to another safely and conveniently. Obviously, not. But crypto bridges work by wrapping tokens on one network to an equivalent amount on another. This might sound complicated, but it’s really not. Think of wrapped tokens as representations of the value of the original token on other platforms.
Furthermore, Nomad is a blockchain messaging platform that allows players such as developers to share arbitrary data across chains and even make smart contracts. The service makes online collaborations when developing blockchain applications while working from different regions much more convenient.
What Safety Considerations Should You Have When Buying Crypto?
It’s unfortunate, but the world of cryptocurrency is cutthroat in every sense of the word. On the business side, hundreds of currencies exist, and more are joining the market every day, driving up the competition. There are also hundreds of different crypto products at various stages of their development process. Furthermore, we are also only starting to understand the real implications of blockchain technology and cryptocurrencies.
Unfortunately, this has also created the perfect storm for scammers and players with malicious intent to thrive. For instance, in the case of Nomad, even though we still maintain that this is a case of gross negligence, it also reflects the prevalent evils in this space. However, vulnerabilities, where anyone can just walk into a platform and withdraw more than there is, should not exist in the first place.
The pill is easier to swallow when you hear hackers went on a phishing expedition or discovered a system flaw that moves the industry’s security forward. As such, you should be very keen with any dealings or transactions you make with crypto to avoid being one of the victims.
One way to protect yourself is to buy crypto with a prepaid card that does not link back to your primary accounts or personal information. This will limit your risk of losing more than is on the prepaid card if you get hacked or compromised somehow.
You should also only sign on to crypto services like bridges, wallets, exchanges, and currencies on reputable platforms with a proven safety record. As important as first adapters are to the product introduction cycle, we can all agree it’s safer to step back from new ones in the crypto scene. This will ensure you’re not one of the people who lose their investments from hacks like the one witnessed at Nomad.
A problem to Solve
The truth is that stories of people invested in a new crypto venture losing their money are common in the news today, and we have all but grown numb and accustomed to them. But it should not be this way.
For far too long, hackers and ill-prepared crypto platforms have cost far too many their crypto investments and confidence in the system. And even though, in Nomad’s case, they have attempted to recover the lost funds, we think it’s time authorities take a hard look at the crypto industry and provide lasting solutions to the problems that plague it.
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