A shocking revelation has emerged from the Solana-based Cypher Protocol, as pseudonymous developer Hoak confessed to pilfering nearly $300,000 worth of user funds and subsequently squandering them in gambling endeavors.

The deceitful actions of Hoak, a core developer of the decentralized exchange (DEX) Cypher Protocol, came to light following a public statement shared on May 14 via a post on X. In his confession, Hoak admitted to the theft, asserting, "The allegations are true, I took the funds and gambled them away. I didn’t run away with it, nor did anyone else."

This admission of guilt follows a previous revelation made on May 13 by another pseudonymous core contributor known as Cobra. Cobra disclosed the absence of funds, shedding light on the exploitation that went unnoticed for months despite over 36 individual transactions.

According to Cobra's findings, the stolen funds, totaling $317,000 in Solana's SOL, Tether USDT, and USD Coin, were funneled to the Binance exchange via intermediary wallets. These transactions were conducted surreptitiously, with Hoak's wallet holding over $68,365 worth of digital assets at its peak on Dec. 7, 2023, before the majority of the funds were transferred out in subsequent days.

This incident dealt a severe blow to Cypher Protocol, which has been striving to recover from a previous hack in August 2023, resulting in the loss of over $1 million worth of digital assets.

In his statement, Hoak attributed his actions to a debilitating gambling addiction and various unchecked psychological factors. His admission underscores broader concerns within the cryptocurrency industry regarding casino-like behavior and the prevalence of gambling addiction among participants.

Critics of the crypto ecosystem have often likened its speculative nature to gambling, with some likening it to the "Wild West" of casinos. This sentiment was echoed by Gary Gensler, Chair of the United States Securities and Exchange Commission, who compared the crypto landscape to "casinos in the Wild West," emphasizing the risks associated with unstable coins.

The revelation of Hoak's actions serves as a sobering reminder of the potential risks and challenges faced by participants in the cryptocurrency space, highlighting the need for greater accountability and safeguards against exploitation.