Desire

Former Alameda Research engineer turned whistleblower, Aditya Baradwaj, recently took to the social media platform X to expose a string of security incidents that led to staggering losses of $190 million within FTX’s sister hedge firm. 
<h2 id="b-the-hack-unveiled-b">The Hack Unveiled</h2> 
Baradwaj <a href="https://twitter.com/aditya_baradwaj/status/1712181989929840732?ref_src=twsrc%5Etfw%7Ctwcamp%5Etweetembed%7Ctwterm%5E1712181990772912247%7Ctwgr%5E09c3a93c5f99d3c6034a015751560e9d0e8de54f%7Ctwcon%5Es2_&amp;ref_url=https%3A%2F%2Fcointelegraph.com%2Fnews%2Falameda-research-lost-190-million-fake-links-scams-former-engineer">disclosed several instances where Alameda Research’s</a> lightning-fast decision-making and risk-taking culture contributed to substantial financial losses.&nbsp; 
One of the most notable incidents involved a seasoned Alameda trader who unwittingly fell victim to a phishing attack while attempting to complete a Decentralized Finance (DeFi) transaction.&nbsp; 
This unfortunate event transpired due to the trader’s inadvertent click on a counterfeit link that had been maliciously promoted to the top of Google search results. The aftermath of this mishap amounted to a staggering loss of $100 million. 
Another significant incident detailed by Baradwaj revealed that Alameda had engaged in yield farming on a blockchain platform of “questionable legitimacy.” This ill-advised move eventually led to losses exceeding $40 million. 
<h2 id="b-alameda-research-nurses-the-desire-for-speed-b">Alameda Research Nurses The Desire for Speed</h2> 
According to Baradwaj, the attitude at Alameda Research, driven by FTX founder Sam Bankman-Fried, prioritized agility as the single most important factor. This relentless focus on speed meant that Alameda often overlooked industry-standard engineering and accounting practices that should be the bedrock of such firms.&nbsp; 
Instead, the company was known for its minimal code testing and incomplete balance accounting. Baradwaj highlighted that safety checks for trading were added only when absolutely necessary. 
Furthermore, Baradwaj revealed that blockchain private keys and exchange API keys were stored in plaintext files accessible to several employees. This relaxed security practice laid the groundwork for yet another security incident, resulting in the leak of an old version of plaintext files containing keys to Alameda’s wallets. The financial damage caused by this security breach amounted to $50 million. 
Baradwaj’s revelations did not stop there, as he hinted at multiple other security breaches that occurred both during and before his time at Alameda Research.&nbsp; 
<h2 id="b-caroline-ellison-s-testimony-b">Caroline Ellison’s Testimony</h2> 
Baradwaj’s remarks follow former Alameda CEO Caroline Ellison’s testimony on the sixth day of&nbsp; Bankman-Fried’s fraud trial. Her <a href="https://thecoinrise.com/sbf-trial-caroline-ellison-testifies-of-bankman-frieds-financial-maneuvers/">testimony has been a focal point in the ongoing legal battle</a>.&nbsp; Ellison, along with other former colleagues such as Adam Yedidia and <a href="https://thecoinrise.com/gary-wang-reveals-ftx-fabricated-its-insurance-fund/">Gary Wang, has provided a wealth of new evidence</a> against Bankman-Fried. 
The post <a rel="nofollow" href="https://thecoinrise.com/former-alameda-research-engineer-reveals-190m-loss-to-scams/">Former Alameda Research Engineer Reveals $190M Loss to Scams</a> appeared first on <a rel="nofollow" href="https://thecoinrise.com">Latest News and Insights on Blockchain, Cryptocurrency, and Investing</a>.

Former Alameda Research Engineer Reveals $190M Loss to Scams

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