The Ethereum-based platform, PayFair, is undergoing a temporary closure after experiencing an attack on its main cold wallet, according to information shared by a media company.
In the unfortunate event, there was a discreet movement of funds from PayFair main wallet to an undisclosed new cold storage. Following the incident, PayFair closed its site in a bid to curb further attacks. The occurrence also caused a stir in the crypto space, with some people thinking it was an exit scam. However, PayFair Communication Manager, John Pomelov, assured the users it wasn’t an exit scam. He said:
“I don’t think that it makes sense to “exit scam”, after 3 years of the platform’s operation, we suddenly decided to give it up, it’s pointless.”
PayFair Conducting Internal Investigation
The company has embarked on an internal investigation, saying that the they have lost quite a small amount of ETH. They did not provide the exact figures of the amount lost, saying that the company would reveal more information on the amount involved in the heist next weekend, when they will also disclose the schedule to return funds.
According to PayFair, the attack took place on September 29, following a hacking activity on its escrow platform. There is still no clear information on how the private key of the cold wallet was compromised, with the PayFair team saying that hacks have become more advanced.
Hackers Target Private Keys
On several occasions where hacking is involved, the culprits often target the private keys. Examples include what happened at Coincheck and Cryptopia exchanges. Coincheck has since announced its decision to close business by December 1, 2019. In the case of Cryptopia, hackers used the private key and expunged all copies of the keys for the exchange. In the end, Cryptopia could not recover even a small bit of the funds.
All the same, even after the incident, PayFair Market Price (PFR) remains relatively constant at $0.000865, which is a 0.49% increase in its 24-hour trading window. PFR value has been trading above $0.45 since December 2018, before it wiped out most of its value.