What is Nomad crypto heist? How has it impacted cryptocurrencies' prices?

4 min read | August 03, 2022 12:50 PM AEST | By Ankit Sethi

What is Nomad?

Nomad -- also referred to as Nomad crypto -- is a blockchain interoperability service provider. A few cryptoassets with ‘nomad’ in their names, must not be confused with Nomad, which calls itself a “cross-chain messaging protocol”. It provides smart contracts services, with a promise of high security, reduced gas fee, and a way to allow off-chain players within the chain.

The primary offering of the company is Nomad token bridge, which is said to be available on Ethereum and Moonbeam. The services can be used by blockchain developers to build and deploy xApps, which come with cross-chain functionality. Digital assets can be bridged across chains by using Nomad.

Also read: Is Bitcoin to blame for Saylor quitting MicroStrategy’s CEO office?

Nomad crypto heist

Nomad has officially acknowledged the “incident” that has struck its token bridge. In a statement, the company said that it has notified law enforcement agencies, besides starting the process of identifying and recovering the lost funds. The latest tweet mentions how Nomad is thinking of “technical fixes” to deal with this challenging situation.

According to reports, the heist has cost nearly US$190 million, however, the exact amount will become clear only with time. The lost cryptos reportedly include Ether and USDC. The Nomad crypto theft follows another multi-million-dollar theft of cryptos that hit a company named Harmony in June this year.

Cryptocurrency prices

It is notable that Ethereum’s Ether token had been on a path of recovery over the past few weeks. From US$1,100 to over US$1,600, the token’s stunning rise during the second half of last month was being closely observed by analysts.

As of writing, Ether is once again hovering under US$1,600, with a slight drop in value over the past 24 hours. This takes Ether’s year-to-date (YTD) loss to nearly 57%, more than that of Bitcoin. Bitcoin is also under pressure and is now trading under US$23,000.

Ethereum price (in USD)

Data provided by CoinMarketCap.com

Bottom line

The latest crypto theft involves a compromise of the Nomad token bridge. Reports say that nearly US$190 million worth of cryptos have been stolen. This seems to have added pressure on crypto prices, which were on a path of slow recovery over the past few weeks.

Also read: Who is Ishan Wahi and what is crypto insider trading?

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