Sonic is a quote-unquote "decentralized" — but maybe not — exchange on Internet Computer Protocol that just got hacked, and there is a very important learning opportunity here. I got a very excited text message this morning from one of you. If you want to be able to message me and ask questions whenever something like this happens, you can do exactly that when you join the Jerry Banfield Family.
The message I got this morning was about this Sonic hack. The exact post that was sent to me was Map Technical Forecasting's post talking about how we were told ICP was hack proof — you'd think the DEXs would be safe. First we see KongSwap get hacked and drained, and then Sonic. And the big question the post raised is this: is everyone on the ICP swaps a sitting duck? How do we know for sure the next one isn't going to be hacked and drained?
ICP Is Unhackable — the Apps Built on It Are Not
There was a great reply on that post, and before it was even posted, I had made the same basic reply by text within a few minutes as my response. What I said was this: when you say ICP is unhackable, it means the infrastructure — the blockchain. Apps that are built on ICP are protected from things that would attack the infrastructure, but they are not protected from their own potentially poor design. And more importantly, they are not protected from insiders exploiting loopholes.
My first thought when I saw that Sonic had been hacked was that this was an insider who already knew the project was dead. And it looks that way from what we read. What Moses said — inside job, not a hack — I absolutely agree with. That was my very first thought. Now, just because that was my first thought does not mean it's right. But my first thought was that this is an inside job: they know it's going to zero.
Stockholm said the same thing: "I don't know why, but I'm almost sure this is an inside job. The Sonic founder drained the Sonic DEX a while ago. It was abandoned — no team response. Then the owner started building the same DEX on Solana. Now they probably heard about multi-DEX, then decided to nuke his whole platform."
"Decentralized" Projects That Are Really Centralized
This is what you need to learn in crypto: most of these projects that claim they're decentralized are really just centralized projects that are trying to shield themselves from real accountability. And that means you have to be very careful where you put your money. Now, that's not financial advice — I'm not a financial advisor, and I'm all in on ICP. This is why I've withdrawn my attention from individual ICP projects, and this is why I avoid buying any coins besides ICP, because this is a risk that runs across all of crypto.
In fact, I can see us having a total crypto collapse at some point. When there's enough momentum — when coin prices keep going down, and people keep getting more and more skeptical that any of these projects are ever going to make a comeback — there is more and more of an incentive for teams to just quote-unquote "hack" their own project, exactly like what happened with Sonic. They are in the best position to know where the project is vulnerable and how to destroy it, and they can even intentionally set it up with a backdoor so that they could destroy it later. I imagine that as many of these cryptos start to plunge toward zero, a lot of them are going to just hack themselves, steal everything, and run off.
Transparency, Accountability, and a House of Cards
This is why investing in anything where the team is not transparent is extremely risky, and it's why I love ICP. You've got 180 people whose faces are posted online and who are accountable. And while the price chart makes it look like that same story happened with ICP, I've come to believe it was intentionally manufactured that way to protect the rest of the deception and lies in crypto.
I watched Bobby O's video today where the BitTensor TAO founder was up there talking about all of this. He compared it like this: he said the internet was the first big innovation, then Bitcoin was the second — and he skipped right over Ethereum and went straight to BitTensor TAO as the third big technical innovation of the last 30 years. That is so blatantly ridiculous and obvious — lying, in my opinion, extreme deception. And yet this guy has a platform and a stage, that's the message he's putting out, and that's what people are buying off of. It would be very easy for BitTensor TAO to go to zero in the future, because it's all a house of cards. There's almost nothing real there — and that's almost everything else in crypto. Everything else in crypto depends on people being ignorant of how all this stuff works.
So every time something gets hacked, every time an exchange goes down, I hope people in crypto are getting smarter and asking better questions. Because when you're taking painful losses, or you see other people taking them, that's the opportunity to learn and get smarter.
"Hacked" Is Not the Right Word
When I see things like Sonic getting hacked, it seems to me the word "hacked" is not very efficient here. I would say more directly that it was drained by insiders, or exploited, or that somebody stole from it. "Hacking" kind of makes it sound like someone used an AI tool or some hacking software and attacked the infrastructure — which is what a lot of cybercrime is based on, and which ICP prevents most of. So I'm grateful today for the motivation to put this together. I hope what I share always teaches you, educates you, and helps you.
To me, this should be the default assumption: I always assume almost anything like this is an inside job unless proven otherwise. When I hear that something was hacked by North Korean hackers, I don't believe that. I don't believe it was North Korean hackers. I often believe it was some insider at the company or the protocol, or it was some state actor — and North Korea is a convenient scapegoat. I don't believe it was North Korea, but who knows, and I don't want to get any more specific than that. That's just how I generally think, because there is so much lying and so much deception when it comes to money, and so many of these things are just blatant theft.
Bitcoin and Ethereum Were Dial-Up. ICP Is Fiber.
The more people in crypto realize that almost all of crypto is lying, cheating, stealing, and confusion, the better. And the simple truth, as I see it, is that ICP has infrastructure that is very valuable. I believe ICP is the one that's going to be the most valuable thing for the world to come out of crypto — not Bitcoin, not Ethereum. Bitcoin and Ethereum were kind of prototypes, the way dial-up internet was a prototype. It gave you an idea of what you could do, but it's clearly not the future. Once you get the real infrastructure — fiber-optic internet — you can actually do all the stuff you really want to do on the internet, and you don't need better infrastructure beyond that.
At this point, my cable company keeps trying to tell me I should get faster speed, and I don't know what they expect me to do with it. I don't need faster speed. I have one gigabit up and down. I don't need two gigabits up and down, because one gigabit is enough. In the same way, ICP as infrastructure is enough to solve most of the major problems in the world at the infrastructure layer. Now, what it doesn't solve for is apps and founders that are dishonest, that steal from their own protocols, that chase liquidity, and that are just doing anything to make money. It doesn't stop that — and that's the majority of crypto.
Modern-Day Organized Crime
Almost all of these apps and almost all of these blockchains, in my view, are theft. They are the modern-day organized crime. But instead of people being out in the streets with guns, they're on YouTube — some of them wearing masks, others saying ridiculous things. This is modern-day organized crime: groups of people working together to steal money from the masses, to prey on the ignorant masses.
Unfortunately, the primary solution is for the masses to stand up for themselves, to get more educated, and to get harder to rip off and harder to rob. It's the same as the laws we have here in Florida, which protect our citizens — in Florida, you don't want to rob somebody, because there's a good chance they have a gun also, and then you're even. In crypto, we need to strengthen people's minds and strengthen people's knowledge, and get more people to see the truth as I see it: ICP is the infrastructure, it's the safest thing in crypto for me to hold, and I believe it is the blockchain of the future. That's a big part of why I keep sharing everything I learn about it on my ICP Crypto playlist.
And that does not mean the apps on ICP are safe themselves. I am extremely skeptical before putting my money into anything, and in my experience, that is the ideal way to proceed.
Don't Panic by Yourself
If you enjoyed this, I would love to get to know you better in the Jerry Banfield Family, and I would love for you to be able to reach out to me anytime. You don't have to panic by yourself, or just go to random people on X and hope that somebody is going to say something useful. You can come straight to me. You can have calls with me every week, and you can connect with everybody else who's in the Family also.
To me, community is one of the best ways you get smarter, and one of the best ways you stay insulated from all the bullshit that's being put out all over the place — a community of people who are discerning, who are able to see through what's happening, and to see through to a simple truth like ICP. I invite you to be part of the Family, and I would love to get to know you better soon.