Thursday, June 13, 2024

DeFi Weakness Conduces to Lost USD 325M in a Hack

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Alicia Garcia
Alicia Garcia
Alicia is excited about all things tech. She devotedly follows blockchain and crypto updates, sharing her passion through writing about it. She is a regular contributor for cryptocurrency news and articles.

The DeFi bridge between Solana (SOL) and other blockchains Wormhole lost wETH 120,000 (USD 325m) in a hack, once again stressing the weaknesses of this nascent sector. The team offered the hacker a USD 10m bounty if they return the funds.

In their latest update (12:41 AM UTC), Wormhole confirmed that the vulnerability has been patched and they “are working to get the network back up as soon as possible.”

Per crypto analytics firm Elliptic, this is the fourth largest crypto theft of all time, and the second-largest theft from a DeFi service. According to the analysts, the exploit appears to have allowed the attacker to mint 120,000 wrapped ETH on the Solana blockchain, ETH 93,750 of which was then transferred to the Ethereum (ETH) blockchain.

“This demonstrates once again that the security of DeFi services has not reached a level that is appropriate for the huge sums being stored within them,” Tom Robinson, Co-founder of Elliptic, told Bloomberg. “The transparency of the blockchain is allowing attackers to identify and exploit major bugs.”

Wormhole claims it has integrated seven blockchains –  Ethereum, Solana, Terra, Binance Smart Chain, PolygonAvalanche, and Oasis – and has USD 1bn in total value locked.

Per their website there are two features built on top of the generic message-passing protocol including:

  • A token bridge that allows users to bridge wrapped assets between supported chains.
  • An NFT bridge that allows ERC721 and SPL NFTs to be transferred between Ethereum, Binance Smart Chain, Polygon, Avalanche, Oasis, and Solana.

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