A Russian blockchain engineer lost over $500,000 worth of cryptocurrencies in a sophisticated cyberattack, highlighting the persisting and increasing threats posed by hostile open-source packages.
Even seasoned users can be duped into installing malicious software by attackers using public repositories and ranking algorithms, despite the developer community's growing knowledge and caution.
The incident was discovered in June 2025, when the victim, an experienced developer who had recently reinstalled his operating system and only employed essential, well-known applications, noticed his crypto assets had been drained, despite rigorous attention to cybersecurity.
The researchers linked the breach to a Visual Studio Code-compatible extension called "Solidity Language" for the Cursor AI IDE, a productivity-boosting tool for smart contract developers. The extension, which was made public via the Open VSX registry, masqueraded as a legal code highlighting tool but was actually a vehicle for remote code execution. After installation, the rogue extension ran a JavaScript file called extension.js, which linked to a malicious web site to download and run PowerShell scripts.
These scripts, in turn, installed the genuine remote management tool ScreenConnect, allowing the perpetrators to maintain remote access to the compromised PC. The attackers used this access to execute further VBScripts, which delivered additional payloads such as the Quasar open-source backdoor and a stealer module capable of syphoning credentials and wallet passphrases from browsers, email clients, and cryptocurrency wallets.
The masquerade was effective: the malicious extension appeared near the top of search results in the extension marketplace, thanks to a ranking mechanism that prioritised recency and perceived activity over plain download counts. The attackers also plagiarised descriptions from legitimate items, thus blurring the distinction between genuine and fraudulent offerings. When the bogus extension failed to deliver the promised capabilities, the user concluded it was a glitch, allowing the malware to remain undetected.
In an additional twist, after the malicious item was removed from the store, the threat actors swiftly uploaded a new clone called "solidity," employing advanced impersonation techniques. The malicious publisher's name differed by only one character: an uppercase "I" instead of a lowercase "l," a discrepancy that was nearly hard to detect due to font rendering. The bogus extension's download count was intentionally boosted to two million in a bid to outshine the real program, making the correct choice difficult for users.
The effort did not end there; similar attack tactics were discovered in further malicious packages on both the Open VSX registry and npm, which targeted blockchain developers via extensions and packages with recognisable names. Each infection chain followed a well-known pattern: executing PowerShell scripts, downloading further malware, and communicating with attacker-controlled command-and-control servers. This incident highlights the ongoing threat of supply-chain attacks in the open-source ecosystem.
