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Pepe Creator Matt Furie Faces Lawsuit Over $1M NFT Hack Linked to North Korean Operatives

Stylized frog in suit with money, symbolizing Matt Furie’s Pepe NFT and $1M hack controversy

On August 4, 2025, Jaggedsoft, a prominent crypto developer known for creating a widely used PHP library for Binance’s API, filed a lawsuit against Matt Furie, creator of the Pepe the Frog meme, and his NFT platform CHAIN/SAW, alleging gross negligence following a $1M hack in June 2025, per VoiceOfCrypto. The breach, potentially tied to North Korean hackers, targeted Furie’s NFT collections (Replicandy, Peplicator, Hedz, Zogz) and the Favrr platform, exposing vulnerabilities in Web3 security practices, per CryptoNews.com.

Details of the Hack

Blockchain investigator ZachXBT traced the exploit to suspected North Korean IT workers hired as developers, who gained control of smart contracts, minted new NFTs, and dumped them to crash floor prices to zero, per BeInCrypto. The attack unfolded in stages:

  • June 18, 2025: The Replicandy contract was transferred to address 0x9Fca, withdrawing mint proceeds and dumping NFTs, per CryptoRank.io.

  • June 23, 2025: The same address hijacked Peplicator, Hedz, and Zogz, netting ~$310,000, with Favrr losing $680,000, per AInvest.com.

  • Laundering Path: Funds moved through wallets (0xf6a9, 0x7e58, 0x58f4) to the MEXC exchange, with some linked to prior stablecoin transfers ($2,000-$10,000), per CryptoNews.com.

ZachXBT identified red flags: a developer posing as U.S.-based used Korean language settings, Astral VPN, and Asia/Russia time zones, per BitcoinEthereumNews.com.

Jaggedsoft’s Allegations

Jaggedsoft, a major collector of Furie’s NFTs, accuses CHAIN/SAW and Furie of:

  • Ignoring Warnings: Failing to heed security advice and hiring unvetted developers, per LiveBitcoinNews.

  • No Audits: Smart contracts lacked external audits, a critical oversight, per Decripto.org.

  • Cover-Up: Deleting a warning post on X and disabling DMs, with no public statement from Furie or CHAIN/SAW since June, per BitcoinEthereumNews.com.

  • Intimidation: A CHAIN/SAW co-founder allegedly threatened Jaggedsoft, saying they’d “fuck [his] life up” if he pursued legal action, per BitRss.Jaggedsoft seeks to invoke consumer protection laws, citing CHAIN/SAW’s failure to disclose risks and post-hack silence as fraudulent, per CoinLive.com. He expressed betrayal, stating, “I didn’t want to involve Matt. He did great art. But he’s also responsible,” per VoiceOfCrypto.

Community and Market Reaction

  • X Sentiment: @Cryptopathic and @JulbyJuli slammed Furie and CHAIN/SAW for inaction, with @JulbyJuli estimating damages could reach $7M (1-2K ETH), per. @NathanHeadPhoto noted the North Korean link, urging community pressure on Furie’s Instagram, per.

  • Market Impact: Affected collections’ floor prices collapsed, with Replicandy and Hedz deemed “worthless,” per 99Bitcoins.com. The broader $3.6T crypto market saw a 1.64% dip, with BTC ($114,333) and ETH ($3,553) facing volatility, per BeInCrypto.

  • Lazarus Group Context: North Korean hackers, possibly Lazarus, have stolen $3B+ from crypto since 2016, using tactics like PylangGhost malware, per Cryptonews.com.

Furie’s History with NFTs

Furie, who created Pepe the Frog 20 years ago, entered NFTs to reclaim his character from alt-right misuse, selling a Pepe NFT for $1M in 2021, per The Washington Post. However, prior legal issues include a 2022 lawsuit by Halston Thayer, who paid $537,084 for a “unique” Pepe NFT only for Furie to release 46 identical NFTs for free, devaluing it to $30,000, per Boing Boing. Furie’s lawyer, Louis Tompros, argued Furie was only the artist, not the seller, per Vice.com.

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