Gnus.AI Network Loses $1.27M to Discord Hack

Gnus.AI artificial intelligence network was hit by a hacker who was able to view team members’ private Discord messages and mint fake tokens, leading to a loss of $ 1.27 million.

On May 5, exposure to token-minting vulnerabilities caused the Gnus.AI artificial intelligence network to incur an approximate loss of $1.27 million. The group declared that a new iteration of the Genius (GNUS) token would be forthcoming and advised users to discontinue the purchase of the previous iteration. 

Gnus. AI is a blockchain network that enables users to execute AI computations in exchange for tokens. 

The perpetrator executed the breach by acquiring the private key to the team’s account—which commences with the number 0x18—as stated in a publication on May 6 by the blockchain security firm CertiK.

After gaining access to this account, they duplicated the “salt” data of the token from Ethereum, which enabled them to generate a Fantom network version of the token using the Axelar bridge protocol. 

Subsequently, one hundred million counterfeit GNUS tokens were produced, bridged to Ethereum, and traded on the market. As a result of the price collapse, the wealth of current token holders was transferred to the assailant, who acquired tangible assets in return for tokens fabricated in the dark. 

“SuperGenius,” the CEO of Gnus.AI, asserted in a May 5 post on the social media platform X that an attacker obtained access to the team’s private Discord communications and compromised the 0x18 account, stating, “It appears that the hackers can view private messages on Discord.” 

As a “quick fix,” SuperGenius stated that the team will deposit $500,000 worth of Ether from its funds into a liquidity pool for the newly launched token.

Furthermore, the team shall remit a deposit equivalent to $500,000 in fees that are outstanding but presently suspended until February 2025. In total, this accounts for $1 million in compensation. 

According to an estimation by CertiK, the exploit resulted in a loss of $1.25 million; therefore, the initial allocation of funds will account for 80% of the losses. 

Constantly, blockchain networks are susceptible to exploitation. Despite this, evidence suggests these attacks might diminish as security protocols advance. CertiK reported on April 30 that crypto users experienced the fewest number of exploit-related losses since 2021 in April.