Arthur Hayes, Maelstromfund’s chief investment officer, said he liquidated his entire zcash (ZEC) position after a developer revealed a potential critical vulnerability in the network’s Orchard Pool.
Hayes, who previously championed the privacy token, said on
The now-patched vulnerability was revealed by Shielded Labs, which said a major issue went undetected for four years and could have allowed a hacker to print an unlimited number of counterfeit tokens, damaging trust in the crypto supply and its value. The token crashed following the announcement and was recently down 42% over 24 hours.
“I heard about this exploit yesterday and didn’t understand how much it violated my narrative mental map,” Hayes said. “The 30% drop made me rethink and I had to take profits on the entire position.”
The vulnerability, present since 2022, was discovered on May 29 and fixed on June 1, Shielded Labs said.
Hayes, who also co-founded the BitMex exchange, said he would reevaluate his position in the future and, if his assumptions prove incorrect, he would buy back ZEC “hopefully at lower prices.”
Blockchain analytics and intelligence company Arkham wrote on X that a large investor lost more than half the value of its $174 million ZEC reserve.
“He hasn’t sold ZEC in 6 months. Ouch,” Arkham said.
