Behind the Scenes: DeFi Hack Negotiations - TOKEN2049 Singapore 2024

I have the privilege of uh interviewing ogul uh today um ogul you may or may not know him but you may or may have benefited from his work has been responsible for recovering over $400 million in hacked def5 funds um he's worked on Oiler he's worked on alchemix he's worked on kyber Swap um ogul you generally when people think about defi security they think about auditing they think about smart contract you kind of come in almost after the fact and thinking hey how do we actually get the funds back if there is a hack and negotiating with hackers directly how did you start doing this like what's your background it was such a crazy story when I when I heard it for the first time um I'm curious to hear kind of more so I have like a tech hobbyist background a security Tech hobbyist background for 20 years give or take in the security space uh but I also built businesses and so I've done a lot of negotiation like uh it you know that's that sort of a requirement and so whenever you come into crypto space um you have a lot of techie people and they think in the techies brain and then you have sort of business people who think in the business brain there's very little of the overlap there and it's the same way whenever you have like hacks you have on the other side someone who has both technical Acumen and they have a financial incentive there's a business and there's a technical side of that and so in the recovery of these things so whenever something actually gets hacked often uh well for pretty much the entirety of the crypto uh experience we've had people go at it from a tech perspective specifically and they say I'm going to trace you down I'm going to find you on the Chain I'm going to do this I'm going to do that and there's none of the personal part of it and so a couple of years ago there was a hack that happened and some people who were um in a community of mine had a lot of money $25 million give or take stolen and I said you know what let me see if I can get that back so I found the people who did it I did some some techniques found who did it chased them down uh they fled from Hong Kong to to uh England and found I found what hotel they were at and eventually they got arrested and it was sort of a recovery and it was really exciting to me but then I was thinking you know maybe this is something that I could continue to do um to help out the industry in general and so that's what I've done so as you mentioned there's a lot of them that I've been helping with I do a lot less of the tech side although I'm capable of doing that I just think there's a lot there's a little bit less less value from that and I focus a lot more on who's on the other side of the screen stealing the money and how do I get them to give me the money back without us having to go steal it back I think that's actually interesting thread because I think maybe some of the public uh perception of these hacks is someone Anonymous comes in they steal the funds they you know send do some sort of privacy service and then they leave and you never hear from them again we can't track it um you've been pretty successful in actually uh using different methods to find these people and then engage in negotiations H how would you describe the types of people who are hacking you know D5 protocols and and what are these negotiations like like how do you create leverage with them what are they sort of thinking about when when you reach out to them it kind of get us in that mindset yes so so there's different types of people who do these hacks and you can a little bit determine how sophisticated they are by how they do the attacks so in some cases it's like a it's like a crime of opportunity and so clearly they were just sort of drive by they see a thing they press the button they steal 50 million bucks that happens and so this might not be a career criminal this might just be someone who's clever and saw an opportunity to pick a wallet up off the ground and they took it and they you know now now there they are and so with someone like that when you communicate with them you don't have to be so abrasive you don't have to be so rude you don't have to be so mean so aggressive you can say hey look you saw an opportunity you took it fair enough a lot of people would that's okay but do you want to spend the rest of your life looking behind you do you want to spend the rest of your life worrying if you're going to get arrested is it really worth 5 million bucks or 7 million bucks or whatever it is probably not and so and the communications which are usually on chain at first and then I try to get them to go to Telegram or something similar in those Communications I'm just trying to like connect with them and I'm also Being Earnest like I'm you know I have I have everyone has things they've done wrong in the background I've never done anything like that to be fair by the way but you know we've all done things we we wish we hadn't and if someone can give you a chance to get out of it sometimes people will take it and so um and so that's the first but then you have actual criminals who like come into this and they plan ahead and they're like okay I'm going to like exploit this protocol and that's a whole different ball game in those cases you need to find out who they are and then basically be like look we know who you are if if you don't give it back or most of it back 90% whatever the case is we will have you arrested and or we will release your information and then people can do what they will so it's up to you like you know do whatever you want to and a lot of times people say okay it's fine I mean most of the time actually it's about 65% of the time people say okay okay okay here's here's most of it back I'll take 10% have a good payday cuz I'm a smart clever person or whatever and then we all go live our lives it's uh interesting you about hey some of these are crimes of opportunity it's like finding a wall on the street some of them are very sophisticated how would you kind of describe the people who are hacking or at least you've talked to like are they young are they old where are they kind of coming from like what's the kind of General level of sophistication yeah General level of sophistication is very high as you would expect the age is you know basically whenever the prefrontal cortex hasn't really finished developing yet and because they're making stupid decisions right um so it's 18 20 22 24 this kind of Arena and a very very large amount of them are in Asia uh Singapore actually is a is quite a it pumps them out pretty good and so does Hong Kong uh those are the two places and why I'm not sure but that's that's just how it happens so people often would go to Hong Kong poly or they or they used to go to ACS here in Singapore there some of the these are Elite students usually who just either because they're excited or because they are poor or whatever the case is they decide to take advantage yeah you um have really made a name for yourself I think in um this angle of the crypto security landscape I really can't think of anyone who has on track record that you do like I said earlier you know over $400 million and and hacks recovered so people in the room you may have uh you know benefited from some of Ogle's work if you've uh uh recovered some funds um you were also recently named an adviser to World Liberty Financial um which is a project that is associated with some members of of the Trump family and that they're working on give us some more of the background there like how are you working with them what kind of uh motivated you to get involved yeah so one of their advisers who's who's public he hit me up and he and actually he's he he owns a protocol that at one point I did a recovery for so they had a hack and I I got them the money back with them and um he said hey look ogul like can you do a phone call I need to make sure I'm secure and safe and I said not a problem we got on the phone call we talked for 15 20 minutes and I said hey I don't know who's on the team or who else is there but your weakest link is going to be everyone else and so why don't we get on a call and um like like why don't you put me on a call with the team and I'll teach them some things and make sure everyone's safe and secure and he said okay sure so we got on a phone we got on a zoom call and it turned out that I recognized some of the people who are involved they just didn't know my name in crypto and so they were like oh shoot it's you I had no idea and so fast forward a couple of days they said would you want to be on the on the advisory team and I and you know I'm thinking about this because is complicated like on one hand if this thing does really really well then I'm essentially like I'm forever 50% of people forever hate me because there's an alignment with Trump on the other hand if it does poorly like 80% of people are going to hate me because I'm align with Trump and it's screwed people right and so there's really no positive outcome here from like on like a personal basis but on the other hand I really felt like it was important to um as best as I possibly can try to be a part of this because with Trump being involved a lot of people are going to come in and these are going to be people who are like old like like like my grandpa who don't really know what they're doing but do want to do it right and so that's like a recipe for disaster in crypto we see it all the time with exploits and hacks and and thefts and this sort of thing and so I thought okay if I can embed myself there and get in between the bad guys and for example my grandpa and the tens of thousands of other grandpa like mine who are probably going to come in net net that's probably a positive thing to do um so that's really the motive that's a good point it's not so much an endorsement of the project whatever it may be you're placing guard rails to make sure hey you know there aren't hacks or at the very least you know we can recover any funds that might be hacked um if kamla Harris had had one and she hit me up I would have done the same thing it has nothing to do with politics it's nothing any any side of the political Spectrum uh we got we care about the the users um maybe maybe on that topic what are some I guess under underestimated or or or um underappreciated attack factors that you see teams going after um for for defi hacks um obviously people are familiar with smart contract bugs and and you know things kind of on that level what are some attack factors that you've seen people exploit that maybe teams didn't appreciate or sort of um guard against ahead of time there's really really cool attacks actually being done by uh some more sophisticated groups this stuff called spear fishing it's spear fishing it's been done for a long time but these guys are doing a really good job of it and so basically what they do is they'll say uh they'll hit you up but they'll hit you up from from like a a friend you had when you were 14 that you haven't kept up with and how do they know that because they spent 3 weeks learning about your life life and so they'll hit you up from Johnny and you used to be friends with him but you don't know what he looks like anymore you guys haven't talked in a while but now you are and he'll say hey look I know you're in the crypto space I am too I actually have a really really solid job over here at Paradigm I know you're doing great over there at dragonfly but Paradigm come on and so would you want to chat and you say yeah yeah sure let let's get on there and then they'll actually you know they'll have they'll send you some software to download to to do the uh the zoom zoom meeting but it'll be a fake Zoom or a fake uh application to do that suddenly they're in your system they'll actually have the call they won't be video but they'll do a call they'll use voice offc or AI to fake the voice for a little while it'll sound a little choppy but you'll it'll be believable enough because you haven't talked to this person since they were 13 or 14 so what do you know move on you don't get the job but what's called the rat is still inside of your system and so now they're in the dragonfly ecosystem and they can sit there and hang out or they can exploit it in some way and that's that's really what's happening is happening over and over and over and in fact the uh the FBI just released uh about 10 days ago a um sort of a notice to the ETFs that are coming here that they're being very very heavily uh focused on for this sort of thing because it's so easy you find like someone low level get a little bit higher level a little bit higher level and suddenly you have access to actual real funds that are inside of an ETF like major amounts of funds you um are working on a new project called glue which my understanding is it's designed to um address some of these security issues that you've personally experienced and try to help fix in the crypto space um what is glue walk us through it for the audience yes so glue is a is a is a chain ecosystem so it's an L1 it has l2s it has a deck it has all the things you would expect on a chain but we do it all inside of one thing called the Hub that hub. glue. net and essentially like the differentiator here from our from US versus like everyone else is that my partner and I have backgrounds building web 2 companies doing user acquisition we've built tech companies to very large scale hundreds and hundreds of millions of dollars of Revenue very profitably over the course of 15 years and so we know how to get users and the difficulty in crypto if you think about it is how do you get a user so let's say that you're a a DEX on arbitrum how do you get a user for your deck well you have to convince other people on arbitrum how does someone get arbitrum well they have to know what a bridge is because they had to have bridged from eth how do they get to eth well they had to have gone to coinbase how do they get to coinbase they had you know it's 15 different steps to get to the decks on arbitrum and so in our case we have shortened that to essentially two steps you you see an ad you click on our web page you log in with Google you connect with banksa we There's No Nonsense that you have to do and immediately you're on the chain and you're safer the it's all a lot of it is abstracted away it's much safer than something like coinbase but you get the same experience as something like coinbase so it's very familiar to people and so that way all these new people we can bring in at scale don't get screwed and that's the key because we have a lot of new people come in they get convinced to try crypto and then they get screwed and then they they go out the other cuz it's a scam it's a scam it's all a scam right if we can prevent that from happening and they can sort of learn on our ecosystem they can hang out there for a while and then maybe they venture out to the other other places I think we're all going to be better off yeah I agree with that obviously uh it is not good when people lose funds and get hacked and you know in some ways you know kind of pushes them out of the ecosystem forever sometimes um what are some tips or or what do you want maybe the audience here to walk away uh with today what can they do uh most impactful thing they can do to improve their own security when it comes to crypto I mean I think that like I I sort of I mean if you're a team or if you're a person I think that um what do they say an ounce of preparation is worth a pound of response or something like that like if Pro be be be sort of like uh think about this ahead of time be Pro you know have prophylactic so to speak um about this instead of having to react to a situation that you're surprised by one morning like like that's just not the approach you should take in general with with with security or with your life and so pay attention to what you're doing I mean this is the same stuff everyone said a million times but if I if I'm being honest if I'm being actually honest here I I don't think we should have to have this conversation with everybody I think that we you everyone who's developing it's our responsibility to make that just happen invisibly for them I don't think it should be on people to have to learn the technical details and have to figure all this crap out so that they can keep their money safe I think we should figure that crap out and then make it where they can click a button and it's just good it's just fine and and so so really that's my actual answer I don't I think we we'll tell people how to do it now but you can't you can't spend the like we've been telling people 15 freaking years like it's not going it's not how people think they don't think like that they get up and have a coffee and they go to work we are thinking about how to make this thing actually work for the long run and we need to be developing and and designing systems that help that to be be done well I think that's a very good pitch for glue um if people want to learn more about glue or they maybe they want to get in touch with you um where should they go so glue's website is glue. net GL like the stuff that you play with as a childnet and uh my Twitter is C ypt Crypt Ole e Crypt oal it's exciting and and when can people expect uh glue to launch when when can we finally use it we have private test net right now so so if people are interested in that sort of thing you should go to our Telegram and and fill out some forms and be be a part of that process uh we're announcing on an ongoing basis some of our partners so we've already announced igen a few days ago we've announced uh layer zero a while back we have a bunch of kind of pretty solid partners coming on board and uh the main net and tge should be in the next uh 30 to 60 days if we have if we have a good good time here in Asia very exciting well um once again Ogle you're living legend um thank you so much for joining and um to everyone out there stay safe and uh if you if you do run into issues Ogle and glue have your back thank you so much thank you Tom very much