Chinese VC Loses $42M in Crypto Due to Compromised Mnemonic Seed Phrase

Bo Shen once suffered another devastating personal wallet hack in 2016.

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According to a new Twitter post on November 23, Bo Shen, general partner of venture capital fund Fenbushi Capital, advised by Vitalik Buterin, claims that $42 million in funds were taken from his Trust Wallet on November 10 . Shen, who grew up in China but now lives in Atlanta, says the funds were his personal assets and the exploit does not affect Fenbushi-related entities.

“The incident has been reported to local law enforcement. Both the FBI and attorneys have been involved. Civilization and justice will eventually prevail over barbarism and evil. iron law of human society. It's only a matter of time."

Later that day, blockchain analytics firm SlowMist confirmed the exploit and said the reason for the theft was "compromise of mnemonic words". The company also revealed that a combination of addresses belonging to Shen had been drained of 38,233,180 USD Coin (USDC), 1,607 Ether (ETH), 719,760 Tether (USDT), and 4.13 Bitcoin (BTC). The stolen funds were then deposited on the ChangeNow and SideShift exchanges.

"In addition, we verified during our investigation that

@boshen1011's Trust Wallet is the official version and not a fake wallet. Trust Wallet itself has no security issues related to this theft."

Following the theft of @boshen1011's personal wallet, we immediately took charge of the investigation.

We started by performing on-chain analysis of the stolen assets and hacker address.

Here's what we found https://t.co/ddxSmYvt0I

— SlowMist (@SlowMist_Team) November 23, 2022

On Twitter, Shen thanked users for their supportive comments and reiterated his "commitment to blockchain technology and decentralized services." The last recorded hack of Bo Shen's wallets was on December 8, 2016, after...