Ethereum's Oldest Frozen ICO Just Got Cracked Open

 



A security researcher just did something no one had done before on Ethereum. He unlocked $2 million in ETH that had been stuck inside a broken smart contract since 2016.

The contract belonged to HongCoin, a token sale that raised funds from 48 investors but never hit its target. When a raise fails, the contract was supposed to send everyone their ETH back automatically. A bug in the refund function stopped that from ever happening. The money sat on-chain, fully visible to anyone watching, for nine straight years.

The researcher behind the recovery goes by 0xflorent. He discovered that the contract's admin function had an integer overflow vulnerability. By calling the function with a specific input, the balance of a blocked investor reset to one, which let the refund check pass and released the ETH. The move could only be executed by HongCoin's own multisig wallet, so 0xflorent emailed the team, tested the method on a fork of Ethereum's mainnet, and handed them the recovery steps. The team signed 41 transactions over several days to unlock funds for all 48 investors.

Two investors have already claimed a combined 96.5 ETH, roughly $193,000, according to on-chain data from Etherscan.

What makes this case different from a typical DeFi exploit story is that 0xflorent is not stumbling onto bugs by accident. He built his own Ethereum node and custom scanning software to find contracts holding more than 100 ETH and screen them for vulnerabilities. HongCoin was a deliberate find. There are likely more contracts like it still sitting on Ethereum's ledger.

For anyone who sent ETH into an ICO between 2016 and 2018 and never received a refund, this is worth paying attention to. The tools and legal space to recover those funds may exist, depending on the contract structure.

The full breakdown of how the bug was found, how the unlock transactions worked, and what this means for legacy Ethereum contracts is covered in detail over at CryptoNewsLive.org.

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