Open-Source Trading System Leaks User Private Keys and Exchange API Credentials → Security

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Briefing

The core incident is the confirmed leak of user private keys and centralized exchange API credentials tied to the Nofx AI open-source automated trading system. This vulnerability immediately grants threat actors full, non-custodial control over user funds across all connected platforms, bypassing traditional smart contract defenses. The event is confirmed by security researchers, with real-world theft already occurring, underscoring the catastrophic risk of compromised off-chain system integrity.

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Context

The prevailing risk for any system integrating off-chain automation is the supply chain attack, where a vulnerability in an external tool or library compromises the end-user’s security perimeter. This incident leverages the inherent trust placed in open-source tools, a known class of vulnerability that bypasses code audits by targeting the user’s operational environment and key management practices.

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Analysis

The compromise originated within the open-source automated trading system, a non-smart contract vector. The specific mechanism is a flaw in how the system handled or stored critical user credentials, including wallet private keys and centralized exchange API keys. Once the system’s integrity was breached, the threat actor gained the master keys necessary to execute arbitrary transactions and withdrawals, leading to an immediate and complete draining of linked assets across multiple platforms.

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Parameters

Vulnerability Vector → Private Key and API Credential Leak.
Affected System Type → Open-Source Automated Trading System.
Confirmed Loss Status → Real Theft Incidents Confirmed.
Source of Alert → SlowMist Founder Cos.

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Outlook

Immediate mitigation requires all users of the affected system to immediately revoke all linked API keys and migrate funds from any wallet whose private key was ever imported into the tool. This incident will likely establish new security best practices for automated trading systems, demanding mandatory hardware security module (HSM) integration or multi-party computation (MPC) for key management to prevent single-point-of-failure credential storage.

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Verdict

The compromise of open-source automation tools represents a critical, multi-platform supply chain risk that demands immediate, comprehensive credential rotation across the digital asset ecosystem.

Open source risk, supply chain attack, credential theft, private key leak, API key compromise, automated trading system, wallet drainer, off-chain risk, asset management, multi-platform threat, security vulnerability, smart contract audit, key management, non-custodial risk, code integrity Signal Acquired from → slowmist.io