There is an influx of ICOs with startups raising millions of dollars to start or expand their operations. However, funds theft is a common problem affecting many of the startups in the cryptocurrency and blockchain startups. The latest victim is Taylor where the attacker stole all of the money raised in their ICO.
Taylor is a startup company using a blockchain in an effort to link cryptocurrency exchanges with mobile technology, and issued an ICO to fund their design and launch of a dedicated trading app. Dubbed Taylor Smart, the app is an easy to use cryptocurrency trading assistant.
In a blog post, the Taylor team said that the attacker drained all their balance, 2,578.98 ETH, as well as the TAY tokens allocated to the team and the bounty program, bringing the amount of funds stolen to approximately $1.5 million. The only funds left untouched were those locked by a smart contract allocated to the founders and advisers. According to ongoing investigations, the attack seems to be perpetrated by the same attacker who robbed off CypheriumChain.
Failed Security Measures
The Taylor team maintains that they had security measures in place to avoid such an attack, which eventually failed, and they confessed to have been negligent in attending to various security details. After seeing an attempt on IDEX, the Taylor team opted to delist from the platform. While they may never recover the stolen funds, they believe that there is still a future for the Taylor app and are calling on their community to help them overcome the setback and grow bigger and better.
The Taylor team sent an open letter to their supporters, where they revealed that they only have $25,000 left, and they are currently rethinking their future. In a statement give to ZDNET, Taylor’s CEO and co-founder, Fabio Seixas, said that they are thinking about rebranding and issuing an emergency token sale to raise more funds for their operations. Seixas also notes that they are working with various angel investors to inject cash into the project, but it would take months before a deal goes through.
Taylor’s goal with the two funding options is to raise enough to have a sizeable team to work for 12 months as well as paying for pertinent infrastructure and operational costs. The timeline according to Seixas is enough to launch the app, gain its first users, get traction, and start generating revenue.
When a cryptocurrency and blockchain related startups or ICOs claims that they have become cyberattack victims, there is skepticism surrounding it. Most of them disappear with the investor funds while conducting exit scam. Taylor was on the verge of releasing their app in a matter of weeks when the attack happened and they are calling on investors to participate in their emergency token sale.
They have not revealed further information, only that the attack was a highly coordinated and advanced attack. However, before you invest into any token sale, you had better do your due diligence to ensure the security protocols are sound.