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The decentralized autonomous organization was subjected to a significant smart contract hack, which resulted in a loss of $120 million.
Manipulated Smart Contracts
On February 1, DAO disclosed on Twitter that it has experienced an oracle hack. Additionally, it was revealed that exploiters were able to manipulate the price of AllianceBlock (ALBT) tokens, leading to mass liquidations resulting in millions of dollars worth of losses.
AllianceBlock too updated community on Twitter,
“There was a recent incident involving several Trove ALBTs in Bonq, with attackers gaining access to approximately 110 million ALBT. The incident was isolated to this Troves. None of our smart contracts have been breached or compromised.”
The attack occurred in several transactions. However, DeBank’s multichain portfolio tracker studied transaction history and showed that the bulk of the funds drained in one go was $82.19 million, which occurred at 18:32 UTC on February 1. place on the Polygon network.
In a follow-up tweet, BonqDAO announced that they were working on a solution that would allow users to withdraw their remaining collateral without paying BEUR, claiming that the Bonq protocol has been paused.
PeckShield Crushes It
Blockchain security firm PeckShield conducted an independent analysis of the situation and estimated that losses from the oracle hack amounted to around $120 million, with $108 million stolen via 98.65 BEUR tokens and the remaining $11 million stolen from 113.8 million wrapped-ALBT (wALBT) tokens. .
PeckShield also tweeted about what hackers actually did to steal funds. Price manipulation is performed when an exploiter changes oracle’s updatePrice function in one of BonqDAO’s smart contracts. As a result, they were able to manipulate and inflate the price of waALBT and print over $100 million. The hackers followed this up with another transaction in which they further manipulated the price of WALBT and liquidated the treasure trove. In the end, the hackers took illegal profits and walked away with wALBT and BEUR tokens worth around $120 million. They then traded around $500,000 worth of BEUR on Uniswap and burned all 113.8 million wALBT to unlock ALBT, resulting in a significant price drop. BEUR fell 34%, while wALBT fell more than 50%.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
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