Money Transfer App Telcoin (TEL) Has a Security Problem

Money transfer app Telcoin (TEL) has a security problem

Financial application development company Telcoin (TEL), which specializes in services such as money transfers and international payments, recently faced a system security incident, causing the development team to temporarily shutdown to focus on investigating and fixing the issue.

According to an announcement from security unit PeckShieldAlert, an attacker took advantage of this opportunity to withdraw more than 1.3 million USD from affected user accounts. At the time of writing, the stolen money is still safely in the hacker’s wallet.

This is a serious situation and the company is actively working to fix the issue and provide support and protection to affected users. Updates on the situation will be released once the investigation is complete.

#PeckShieldAlert Telcoin $TEL has dropped -41%
Telcoin has suffered an exploit, resulting in a loss of ~$1.3M worth of cryptos https://t.co/FS756GaeWo pic.twitter.com/LDPZVu05Fv

— PeckShieldAlert (@PeckShieldAlert) December 26, 2023

After 12 hours of trying to understand the cause, the project team discovered that the main cause of the problem did not stem from Telcoin Wallet, but instead was due to the wallet’s proxy implementation error on the Polygon network – impact mainly to wallet addresses that have never made transactions on the Telcoin application.

Related: NFT Trader Platform Experiences Security Vulnerability, Hacked for $3 Million

The team’s next plan is to restore all users’ asset balances to their pre-attack state. At the same time, they claim that they have implemented a bug fix to prevent attackers from exploiting it, and promise that neither private keys nor any user data were exposed in this incident.

Update on #Telcoin security incident: We’ve identified the root cause, which was not an issue with the Telcoin Wallet code itself, but with the proxy implementation of the wallet on Polygon – primarily impacting wallets that have never initiated transactions. We have deployed a…

— Telcoin (@telcoin) December 26, 2023

Chart of Telcoin (TEL)

After Telcoin encountered a problem, the value of the TEL token rapidly decreased by about 65% of its value after this news spread.

Chart of the TEL/USDT pair on Tradingview at 1:41 am on December 27, 2023 (UTC)