Ethereum core developer Zak Cole fell victim to a sophisticated crypto theft scheme involving a malicious AI-powered browser extension, highlighting growing security risks in the Web3 development space.

Attack Details

The incident occurred when Cole installed what appeared to be a legitimate Solidity development tool called "contractshark.solidity-lang" from Cursor AI. The extension——with over 54,000 downloads and professional branding——secretly accessed his system's .env file containing private keys. 【Security experts】 note this represents an evolution in wallet drainer tactics, now targeting developers through trusted coding tools.

Three-Day Access Window

Unlike typical instant thefts, the attacker maintained access to Cole's hot wallet for 72 hours before draining approximately 【$500 in ETH】. The developer's risk mitigation strategy of using segregated testing wallets prevented greater losses, with primary holdings secured on hardware devices.

Industry-Wide Threat

Blockchain security firm Cyvers warns such attacks are becoming increasingly common, with fake VS Code extensions and typosquatting techniques compromising 【17% more developer wallets】 in Q2 2025 compared to previous quarters. ——"These aren't amateur phishing attempts but professionally packaged exploits,"—— noted Cyvers' Hakan Unal.

Defensive Measures

Security professionals recommend developers: • Vet all extensions through multiple channels • Never store secrets in plain text files • Use air-gapped signing devices • Develop in isolated sandbox environments

Drainer-as-a-Service Trend

The incident follows April 2025 reports of malware services offering wallet drainers for as little as 【$100 in USDT】, making sophisticated attacks accessible to low-skilled criminals. Recent cases include a spoofed WalletConnect app that stole $70,000 from Google Play users over five months.

As crypto infrastructure becomes more complex, experts stress the need for enhanced developer education and multi-factor authentication protocols to combat these evolving threats.