Arthur Hayes, chief investment officer of Maelstromfund, has liquidated his entire zcash (ZEC) position following the disclosure of a potential critical vulnerability in the network's Orchard Pool.
Hayes, who previously championed the privacy token, stated on X that while he believed it was extremely unlikely any minting would occur, it could not be cryptographically proven impossible. He added that the 30% price drop forced him to rethink his position, leading him to take profits on the entire stake.
The vulnerability, disclosed by Shielded Labs, had gone undetected for four years and could have allowed a hacker to mint unlimited counterfeit tokens. The token slumped 42% in 24 hours.
Shielded Labs reported the bug was present since 2022, discovered on May 29, and fixed on June 1. Hayes, who also co-founded BitMex, said he would reevaluate his stance and might repurchase ZEC if his assumptions prove incorrect.
Blockchain analytics firm Arkham noted one large investor lost over half the value of his $174 million ZEC stash, having not sold any for six months.