Coindesk Logo

ICO Funds Among Millions Frozen In Parity Wallets

ICO Funds Among Millions Frozen In Parity Wallets

ICO Funds Among Millions Frozen In Parity Wallets

Several high-profile ICO issuers have been affected by the Parity exploit, which has left more than $150 million in ether frozen.

Several high-profile ICO issuers have been affected by the Parity exploit, which has left more than $150 million in ether frozen.

Several high-profile ICO issuers have been affected by the Parity exploit, which has left more than $150 million in ether frozen.

AccessTimeIconNov 9, 2017, 1:30 PM
Updated Aug 18, 2021, 7:26 PM

Presented By Icon

Election 2024 coverage presented by

Stand with crypto

Some high-profile token issuers are feeling the effects of a vulnerability in an ethereum wallet software revealed this week.

After a developer stumbled upon the bug – "accidentally" deleting a code library for the Parity wallet and freezing more than $152 million-worth of ether – several startups and open-source projects that recently launched initial coin offerings (ICOs) have come forward, stating that theirs are among the 151 addresses impacted by the software failure.

As such, the development has put considerable attention on U.K.-based Parity Technologies, the developer of the software, which also saw $30 million in ether stolen in a July hack.

Further, it comes at a time when ethereum itself is receiving a significant amount of attention for fueling around 10,000 ICO projects, 13 of which have raised over $100 million.

One of those 13, interoperability platform Polkadot, raised more than $145 million in a token sale last month and is currently having to deal with $98 million-worth of its ether funds being locked up in Parity because of the flaw. In a blog post, the Web3 foundation, which supports the Polkadot project, asserted that all work will continue regardless of the frozen funds.

According to the post, while the wallet containing ICO contributions has been impacted, it does not represent the entirety of the company's funds, adding:

"Our ability to build Polkadot as planned and to the original timetable has not been affected."

Another ICO issuer effected by the hack but soldiering on is Iconomi, a digital asset management platform that raised more than $10 million from a token sale in September.

According to ethereum blockchain explorer Etherscan, Iconomi's frozen wallet represents around $34 million. However, the company wrote in a blog post that the wallet holds only company assets, not customer funds.

"All users' digital assets stored on the platform are completely safe, and the functioning of the platform is unaffected," the post said. 

Musiconomi, the smallest ICO-funded company to announce publicly that it has been affected, has about $4.8 million frozen in Parity accounts right now. The project has yet to release a statement, although a company representative told CoinDesk it will elaborate as soon as possible.

Meanwhile, on social media, members of the Parity team have urged those affected to get in contact. The firm has also created a dedicated website that allows users to quickly find out if their wallet is among those frozen.

Currently, close to 600 wallets have been verified as locked by the issue.

Cracked ice image via Shutterstock

Disclosure

Please note that our privacy policy, terms of use, cookies, and do not sell my personal information have been updated.

CoinDesk is an award-winning media outlet that covers the cryptocurrency industry. Its journalists abide by a strict set of editorial policies. CoinDesk has adopted a set of principles aimed at ensuring the integrity, editorial independence and freedom from bias of its publications. CoinDesk is part of the Bullish group, which owns and invests in digital asset businesses and digital assets. CoinDesk employees, including journalists, may receive Bullish group equity-based compensation. Bullish was incubated by technology investor Block.one.


Learn more about Consensus 2024, CoinDesk's longest-running and most influential event that brings together all sides of crypto, blockchain and Web3. Head to consensus.coindesk.com to register and buy your pass now.