Recovery of Stolen Ethereum Funds After Phishing Attack

On May 26, a victim who lost $6.91 million worth of 1,807 liquid staked Ethereum has managed to retrieve a significant portion of the stolen funds from scammers. The blockchain analysis firm SlowMist's co-founder disclosed that the former phishing group Inferno Drainer used an offline authorization signature to seize around $7 million worth of Ethereum from a user. Recent reports indicated that the victim recovered 1,445 Ethereum, which accounts for 80% of the stolen funds, with scammers allegedly keeping a 20% reward. Analysts highlighted that the theft was facilitated through a phishing attack where unauthorized ERC-20 tokens were transferred using a legitimate off-chain authorization signature. The breach exploited a feature in Ethereum permissions introduced through EIP-2612, enabling interactions with smart contracts without proper authorization. SlowMist advised the use of tools like RevokeCash and Uniswap Permit2 for detecting abnormal authorizations to safeguard against such attacks. Notably, some criticized the victim's susceptibility to phishing attacks, pointing out the rising instances of cryptocurrency-related scams. The FBI reported that cryptocurrency investment scams constituted a significant portion of all investment losses in 2023.