U.S. crypto firm Nomad has been the victim of a digital theft that saw hackers make off with $190 million of cryptocurrencies owned by users of the service. On August 1, Nomad confirmed the theft in a tweet that said: “We are aware of the incident involving the Nomad token bridge. We are currently investigating and will provide updates when we have them.”
Tapping into the current cryptocurrency craze, Nomad develops software that connects different blockchains such as Bitcoin and Ethereum. The goal is to help cryptocurrency investors securely swap their digital assets, or tokens, across the various blockchains without having to use a third party as a go-between. The token bridge referenced in Nomad’s tweet is a tool that helps users transfer their tokens across the disparate blockchains.
Token bridges: Blockchain security targets
Blockchain token bridges have been hit by several thefts in the past, with more than $1 billion stolen from such bridges so far in 2022, Reuters has reported, citing information from blockchain analytics firm Elliptic. In June, U.S. crypto firm Harmony revealed that hackers grabbed around $100 million worth of tokens from its Horizon bridge product. And in March, hackers stole around $615 million worth of cryptocurrency from Ronin Bridge, a tool used to transfer assets in the game Axie Infinity.
These thefts point to the vulnerabilities of blockchain token bridges and the difficulties in trying to secure cryptocurrency transactions.