By Ed Browne
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The creators of SafeDollar, a cryptocurrency token designed to be stable in price, have claimed they were victims of a cyber attack after its price suddenly plummeted in value to zero on Monday,
SafeDollar is now worth $0 according to a price tracker on its website. The site does not state how much the token was worth before the alleged hack took place, although crypto price tracking service Dex.Guru showed it was priced at about $1.
In a blog post on Monday evening, the SafeDollar team said the alleged hack took place at 3:48 a.m. UTC on Monday (11:48 p.m. Sunday EDT) and resulted in a loss of around $248,000 worth of tokens, which were drained from the SafeDollar network.
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SafeDollar said it was in the process of putting together a compensation plan for those who lost tokens.
SafeDollar describes itself as a stablecoin—a type of cryptocurrency that has its price pegged to some other asset in an attempt to prevent price fluctuations.
The price of a stablecoin may be linked to a traditional currency, such as the U.S. dollar. One example includes USD Coin, a cryptocurrency token with a total market cap of $24.5 billion. The price of each token is always $1.
Cryptocurrencies are notorious for their volatile prices and can often rise or fall by a significant amount in a 24-hour period.
This makes them unsuitable for everyday use by the general public, according to Investopedia, because a currency should act as a mode of storage of monetary value.
Experts have previously warned Newsweek about the risks associated with cryptocurrency trading, including price volatility.
SafeDollar is not the only token to have plummeted in price to zero in recent times. Earlier this month, the TITAN token fell from a price of more than $60 to a fraction above zero in what the development team said was a large-scale sell-off.
TITAN is a decentralized finance token used to create liquidity for a wider project. It was still worth a fraction over $0 as of Tuesday morning.
Billionaire investor Mark Cuban was among those to have been hit by the TITAN crash. He told Newsweek shortly afterwards: "I do take responsibility for not doing the math before I invested."
Cuban did not reveal the exact amount he had lost in the crash, though he told Bloomberg: "As a percentage of my crypto portfolio it was small. But it was enough that I wasn't happy about it."
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