Telcoin (TEL), a mobile-based financial platform that uses the Polygon blockchain, suffered a major security breach on Tuesday that resulted in the loss of over $1.2 million worth of funds from some of its users, according to a blockchain security analyzer, Peckshield.
According to Peckshield’s analysis, the exploit involved a proxy implementation of the Telcoin wallet on Polygon, which allowed an attacker to drain funds from wallets that had never initiated any transactions from the application. The attacker exploited a vulnerability in the proxy code that allowed them to bypass authentication checks and access sensitive data.
The attacker was able to make over $1.2 million in funds from different affected accounts, according to messages posted by Telcoin’s community members on Discord. However, these were only from users who had never used the Telcoin wallet before and not from users who had already made transactions or stored their funds elsewhere.
We’ve identified the root cause, which was not an issue with the Telcoin Wallet code itself, but with the proxy implementation of the wallet on Polygon – primarily impacting wallets that have never initiated transactions,” Telcoin wrote on X.
Telcoin Faces 40% Price Drop Amid Exploit
The exploit caused a significant drop in TEL price, which fell 40% in 24 hours as of Tuesday afternoon. TEL is currently trading at the price of $ 0.001583, with a current market cap of $ 105.02 million. The token is currently trading at $0.15 USD, and 97.93% down from its all-time high of $0.0649 USD reached 3 years ago.
The price decline may be due to several factors, such as fear and uncertainty among investors, loss of confidence in Telcoin’s security and reliability, or profit-taking by traders who saw an opportunity to sell at a lower price.
However, some analysts believe that TEL price may recover soon as more users regain access to their wallets and resume using the platform. They also point out that TEL has some positive aspects that may attract new investors in the future.
TEL is one of the leading platforms for financial inclusion and innovation in Africa and beyond. It offers various services such as trading, remittance, lending, borrowing, saving, investing, and earning interest using cryptocurrencies such as TEL itself.
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