$74M Theft on Cronos Blockchain Forces Crypto.com-Backed Chain to Halt and Reboot

Crypto.com's supported Cronos blockchain was forced to halt and rewind its history after a theft due to the Tectonic protocol, which Crypto.com had heavily promoted. The protocol allowed hackers to drain tens of millions of dollars from Cronos' DeFi ecosystem.

PeckShield estimated that $74 million in funds were compromised, leading to a 6% drop in value for the $CRO token over the past 24 hours. Crypto.com supplied one of the largest retail onramps for Tectonic, and promoted it through its exchange, DeFi Wallet, and Earn program.

The Tectonic exploit was described as a Mango Markets-style price manipulation hack that allowed hackers to withdraw real collateral from DeFi lending protocols using an artificially inflated price of TONIC. This is the latest controversy in Crypto.com's history, with the company being accused of controlling the Cronos Strategic Reserve and re-minting 70 billion $CRO tokens into a 'reserve' despite community opposition.

Crypto.com's association with Tectonic has raised questions about its due diligence and risk management. The company's $500 million investment arm is a strategic partner to Cronos Labs, which was incubated by Particle B, also known as Cronos Labs.