The Roll network allows users to mint branded digital tokens unique to their online presence in order to generate value and provide a way for fans and followers to show loyalty.
On March 14, the hot wallets on the Roll platform were attacked, resulting in the draining of all the tokens which the hacker converted into ETH using Uniswap, the announcement stated.
In a blog post, Roll stated that it believes the incident was the result of a compromise of the private keys of its hot wallet and not a bug in its smart contracts or any token contracts.
Research analyst Igor Igamberdiev delved into the incursion stating that the attacker earned almost 3,000 ETH worth around $5.7 million. 700 of the social tokens taken have already been sent to Tornado Cash and markets for these types of asses have crashed, he added.
Some of the affected tokens include WHALE, MORK, JULIEN, CHERRY, FWB, KARMA, ALEX, KERMAN, SKULL, HUE, and FIRS. On creator called Maxime Hacquard lamented on the loss:
“I’m a creator and our community just lost EVERYTHING. The $PICA just went to 0. I lost like months of salary. As smaller creative communities we just expect more than this. Hoping for a full refund. Confidence there will be seriously damaged either way,”
Igamberdiev added that it could possibly be an inside job since the private keys were compromised and that the victim gave approvals for the transfer function to execute.
“This fact indicates a possible private key compromise or inside job.”
Roll made an apology and has announced a $500,000 fund to help creators and their communities.
“It is hard to put into words how devastating this is and we are really sorry about what happened. We take security very seriously and strive to earn the trust of our creators and communities with their social money but today we messed up.”
Social tokens provide a way for artists, content creators, and even celebrities to generate a following for their fans and those that wish to buy art or memorabilia.
As expected, most of them have tanked following the attack. One of the largest, WHALE with a market cap of $155 million, has dumped 25% on the day while MORK has collapsed 72%, FWB is down 96%, and KERMAN has dumped over 40% according to Coingecko’s social token tracker.