Crypto Venture Capitalist Loses $1.7 Million in NFT Hot Wallet Phishing Attack

By Jana Serfontein March 24, 2022 In DeFi, Illegal, NFTs, Scams, Tokens

Arthur Cheong, founder of DeFi and Web3-focused crypto venture capitalist firm Defiance Capital, tweeted this week that a hacker had stolen over US$1.7 million worth of NFTs from his crypto wallet.

Pieces stolen include five CloneXs, 17 Azukis, 33 Second Selfs, two Hedgies and two Tsubasa NFTs, according to security firm PeckShield. A total of 59 NFTs were stolen.

Cheong said the unknown hacker compromised his device using a technique known as ‘spear phishing’:

Earlier this month, an unknown hacker began draining NFTs from an Ethereum wallet owned by Cheong, which he later confirmed on Twitter. The hacker then proceeded to sell the stolen NFTs on OpenSea and also transferred other tokens such as wETH, Lido DAO, LooksRare and DYDX to their wallet.


As it stands, the perpetrator’s wallet currently contains about 585 ETH, or around US$1.7 million, that can all be traced back to Cheong’s wallet. This figure may increase as the hacker appears to be still moving funds out of Cheong’s account:

Spear Phishing Email Likely Suspect

Cheong said the hacker used what is called a ‘spear phishing’ email to deploy malware on his device, which then proceeded to extract the seed phrase to his crypto wallet:

Phishing Attacks on the Rise

This is sadly not a unique incident, with the incidence of phishing scams rising dramatically this year. In January, OpenSea lost US$3 million in stolen NFTs. In a similar fashion, US$790,000 worth of Rare Bear NFTs were stolen in a brazen phishing attack just last week.

Jana Serfontein

Jana Serfontein

Jana has keen interest in what cryptocurrencies have to offer in regards to NGO’s, governments and the financial system. And is also intrigued with the psychological effect that cryptocurrencies have on society.

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