Kaito AI, a crypto market analysis platform, becomes a victim of a malicious social media hack

Kaito AI, an AI-based platform and most popular for its capacity to analyze the crypto market, became a victim of a malicious social media hack on 15th March, spreading panic and disruption in the world of crypto.

Kaito AI, the renowned AI-based platform, fell victim to a malicious social media hack on 15th March, setting off a chain of events that spread panic and disruption in the world of crypto.

The hack compromised both the platform and the official X (formerly Twitter) account of the platform founder, Yu Hu, leading to the spread of misinformation regarding the platform’s security and the safety of user funds. The attackers, who had taken over the compromised accounts, made false postings, falsely reporting that Kaito AI wallets had been hacked and informing users that their funds were at risk.

This false information spread rapidly and triggered a huge market panic. The token dropped by more than 13% before it could recover on Saturday.

As of now, the KAITO price is $1.43 with a 24-hour trading volume of $628.75 million and, a market cap of $348.03 million. The token price increased 2.08% in the last 24 hours.

DeFi Warhol, a top analyst in decentralized finance, suggests the attackers could have taken advantage of the situation to start short positions on the token before posting the fake messages. Through creating urgency and causing a sell-out, they likely expected to profit from the resulting market disruption.

Hackers are getting smarter. They didn’t tweet a stupid CA and close the replies like the majority do.

Instead, they shorted before tweeting a seemingly legit tweet concerning the $KAITO supply. Perhaps also longed when they lost access. https://t.co/qRYmCQNWQK pic.twitter.com/R7kaMr09fy

After the hack, Kaito AI issued a statement to assure users that the hack had been contained to the social media profiles and had no effect on the platform’s wallets and network as a whole.

Kaito AI’s founder, Yu Hu, also made a public assurance on social media that no tokens related to KAITO had been breached.

“Nothing related to KAITO was compromised, no wallets or supplies. My X account and the Kaito one were both compromised, with the hacker then posting false tweets,” he stated.

Sandra Leow of Kaito AI highlighted in an observation that the timing of the hack in the middle of Yu Hu’s sleeping hours indicated a planned effort to make the most of its effect on the market. The platform team took over the accounts again and assured the public that the platform is still secure.

*IMPORTANT*Yu Hu & Kaito’s X accounts have been compromised.

There has been no compromised KAITO wallets.

They have waited for Yu Hu’s timezone (where he’s asleep) to do it – please ignore.

We’re working to get them back. I’ll update here.

— Kaito (@Kaito_AI) March 15, 2024

It is part of a disturbing and increasing trend of cyberattacks on the cryptocurrency sector. Social media breaches, phishing attacks, and other security breaches have been an emerging menace, with the sector incurring huge financial losses. Cryptocurrency-related exploits and scams were responsible for a whopping $1.53 billion loss in February alone, according to blockchain security firm CertiK. It also mentioned the $1.4 billion Bybit hack by the North Korea-based Lazarus Group as the single largest event of the month.

With the cryptocurrency market continuing to grow and develop, such incidents highlight the need for stringent cybersecurity practices to protect platforms and users from increasingly sophisticated cyber threats. The token has committed to continue striving to enhance security so that the funds and data of its users remain safe from any emerging threats.