Bart Stephens, the co-founder of Blockchain Capital, a prominent venture fund specializing in cryptocurrency investments, has reportedly fallen victim to an alleged SIM swap hack that cost him a staggering loss of $6.3 million worth of digital assets.
This incident sheds light on the growing menace of SIM swap attacks, which the Federal Bureau of Investigation warned about in 2022. These attacks target individuals with substantial cryptocurrency holdings and have surged in frequency, with the FBI estimating a loss of $72 million to this tactic last year, marking a rise from the $68 million reported in 2021.
Rising Threat Of SIM Swap Attacks On Crypto Holders
The recent breach involving Bart Stephens underscores the increasing vulnerability of cryptocurrency holders to SIM swap attacks. These sophisticated cybercrimes involve hackers leveraging personal information found online and on the dark web to manipulate cellular network providers into changing account access. The assailants then exploit this newfound control to alter passwords and access the victim’s accounts.
The lawsuit filed by Stephens, citing an incident that occurred on May 14, alleges that the hacker, known as Jane Doe, managed to compromise Stephens’ cellular network account by using personal data. This gave the hacker the ability to transfer approximately $6.3 million worth of various cryptocurrencies, including Bitcoin, Ether, Maker, Compound, and Uniswap, into wallets under their control.
Further, an audacious attempt was made to pilfer 80 BTC and 6,500 ETH from Stephens’ custodial cold wallet, but a timely email notification foiled it.
Bitcoin threatens to drop to $25K level. Chart: TradingView.com
Blockchain Capital: A Pillar Of The Crypto Investment Landscape
Founded in 2013 by Bart Stephens and his brother Brad Stephens, Blockchain Capital has solidified its presence in the cryptocurrency investment landscape. With its headquarters nestled in San Francisco, the fund has actively supported pioneering crypto startups, including Opensea, Worldcoin, Kraken, and Coinbase. The recent setback, however, has spotlighted the need for heightened security measures in a rapidly evolving digital financial ecosystem.
Blockchain Capital co-founder Bart Stephens. Source: RIA Channel.
Seeking compensation for the financial loss, the costs incurred during the investigation, and the distress caused by the breach, Stephens has initiated legal action. His demand for a jury trial underscores the urgency of addressing the rising incidence of SIM swap attacks that threatens not only individual investors but also the integrity of the cryptocurrency industry as a whole.
As the crypto space continues to advance, the incident serves as a stark reminder that technological innovations must be matched by robust security protocols to protect the burgeoning digital assets of individuals and entities alike.
Featured image from Coverage Critic