A breach targeting Gnus.AI's Discord platform led to losses totaling approximately $1.27 million on May 5. Exploiting the ability to access private Discord messages, the attacker obtained the team's wallet address, enabling them to mint 100 million counterfeit tokens.

Gnus.AI, an artificial intelligence network operating on the blockchain, confirmed the incident and announced plans to launch a new version of its Genius (GNUS) token. Users were advised against purchasing the old version.

Details emerged from CertiK, a blockchain security firm, revealing that the attacker gained control of the team's account with a private key starting with 0x18. Leveraging this access, they extracted the token's "salt" data from Ethereum, facilitating the creation of a Fantom network variant via the Axelar bridge protocol.

Subsequently, 100 million counterfeit GNUS tokens were minted, bridged back to Ethereum, and promptly sold on the market. The ensuing price plunge effectively transferred wealth from existing token holders to the attacker, who received genuine assets in exchange for tokens conjured from thin air.

SuperGenius, CEO of Gnus.AI, disclosed on social media platform X that the compromise of the 0x18 account occurred due to the attacker monitoring private Discord communications. In response, the team pledged a swift resolution, allocating $500,000 worth of Ether from its funds to a liquidity pool for the new token's launch. Additionally, $500,000 in owed fees, locked until February 2025, will be deposited, totaling $1 million in compensation.

CertiK's assessment estimates losses at $1.25 million, with initial fund distributions covering 80% of the losses. Despite this breach, recent reports suggest a decline in exploit-related losses within the crypto community, indicating enhanced security measures across blockchain networks.