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Solana Wallets Hacked: Upside Potential Damaged, For Now

Trade Crypto Here Your Capital Is At Risk
Updated 3 Aug 2022

Key points:

  • Solana Wallets Hacked, Over $5 Million Stolen
  • “Hot” Wallets Compromised
  • Solana Technical, Chart Basing Damaged

“Hot” wallets on the Solana (SOL) blockchain have been hacked, with over 8000 wallets thought to have been compromised. This has at least helped to partially damage the basing and recovery theme for SOL in the short-term

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Solana Wallets Hacked, Over $5 Million Stolen

At least $5 million worth of Solana tokens (SOL), Solana Program Library tokens (SPL), and other Solana-based tokens were stolen on Wednesday as users became aware that their accounts had been compromised and drained of funds. The attack is believed to be still ongoing, and the cause of the attack is still unclear. It is also uncertain whether the vulnerability is limited to the Solana blockchain only, although at the moment, no contagion across to other blockchains has been confirmed.

“Hot” Wallets Compromised

Crypto users have reported that funds from major internet-connected “hot” wallets connected to online apps such as Phantom, Trustwallet and Slope (rather than being on a Ledger) were depleted. It is thought that over 8000 wallets have been impacted in the compromise. Certainly, this attack will renew the continuing debate regarding the security of hot wallets.

Solana Technical, Chart Basing Damaged

The Solana/ USD chart (SOL) has been showing signs of a technical, elongated basing pattern on the chart that has been forming since the mid-June bear market, alongside similar developments for other cryptocurrencies. We have highlighted other basing and recovery prospects in recent posts, including Cardano Price Prediction: ADAUSD Base Pattern, Upside Targets.

Source: IG

Also Read: When Is The Best Time To Buy Crypto?

A series of higher highs and higher lows since the low at 25.78 on 14th June has signalled potential for a more sustainable and forceful base and recovery phase to start to undo the negativity from the 2022 bear market. However, the late July advance stalled just below mid-July peak at 47.67, faltering back from 46.67. In addition, this stall has also seen a reluctance to overcome the bar trend line that comes down from early December 2021.

The subsequent setback has not been helped by the abovementioned hack and early August losses have now approached the up trend line from the mid-June cycle low. A push below here and more notably, the swing low at 34.64, would be a disappointing technical development for the bottoming and recovery efforts.

However, should these supports hold during the current setback, the focus would quickly shift back to the 46.67 and 47.67 peaks and the 8-month downtrend line.

Above these resistances would signal a more robust rally phase and initially target 59.20. Bigger picture risks would then shift to a more aggressive advance towards the 2022 peak at 143.53 into the second half of the year.