• Advertise
  • Submit a Press Release
NewsBTC
Bitcoin & cryptocurrency news
Crypto.com Logo
  • News
    • Bitcoin
    • Ethereum
    • Cardano
    • Dogecoin
    • Ripple
    • DeFi
    • NFT
    • Sponsored
    • Press Releases
  • Analysis
    • Bitcoin (BTC)
    • Ethereum (ETH)
    • Cardano (ADA)
    • Chainlink (LINK)
    • Litecoin (LTC)
    • Tezos (XTZ)
    • Zcash (ZEC)
    • EOS
    • YearnFinance (YFI)
  • Trading Course
  • Directory
    • Crypto Businesses
    • Bitcoin Brokers
    • Casinos
    • Sportsbooks
  • Events
  • Play GamesTry
  • Play Casino GamesTry
  • Free SpinsTry
  • Play FinanceTry
No Result
View All Result
Breaking News: Bitcoin Price Retests $27K Following Fed Rate Decision
  • News
    • Bitcoin
    • Ethereum
    • Cardano
    • Dogecoin
    • Ripple
    • DeFi
    • NFT
    • Sponsored
    • Press Releases
  • Analysis
    • Bitcoin (BTC)
    • Ethereum (ETH)
    • Cardano (ADA)
    • Chainlink (LINK)
    • Litecoin (LTC)
    • Tezos (XTZ)
    • Zcash (ZEC)
    • EOS
    • YearnFinance (YFI)
  • Trading Course
  • Directory
    • Crypto Businesses
    • Bitcoin Brokers
    • Casinos
    • Sportsbooks
  • Events
  • Play GamesTry
  • Play Casino GamesTry
  • Free SpinsTry
  • Play FinanceTry
No Result
View All Result
NewsBTC
No Result
View All Result
Breaking News: Bitcoin Price Retests $27K Following Fed Rate Decision
balancer, crypto, ethereum, defi, STA, STONK

Security Flaw in Balancer Pools Leads to Massive $450K Crypto Hack

Yashu Gola by Yashu Gola
3 years ago
in Company News
Reading Time: 2 mins read
Advertisement
  • Automated market maker protocol Balancer lost over $450,000 in a hacking incident on Sunday.
  • The firm’s co-founder and CTO, Mike McDonald, confirmed that hackers drained at least two of their pools that contained deflationary tokens STA and STONK.
  • He admitted that hackers exploited security vulnerabilities in those tokens to trick their pools into selling them Ether, WBTC, LINK, and SNX at cheaper rates.

Two pools on Balancer, an automated market maker protocol, lost more than $450,000 to a hacking incident that mainly attacked deflationary tokens.

Mike McDonald, the co-founder & CTO of Balancer, confirmed in a Medium post on Sunday that hackers launched the attack in two installments. The first one took place at 0603 UTC, while the other happened about 30 minutes later at 0649 UTC.

Both the attacks exploited STA and STONK, deflationary tokens with 1 percent transfer fees.

Don't wait! Jump on this Crypto Deal and get a 150% Welcome Bonus plus 100 Free Spins on your deposit today!
570% up to 12 BTC + 300 Free Spins for new players & 1 BTC in bonuses every day, only at Wild.io. Play Now!

Anatomy of the Attack

As Mr. McDonald noted, the attackers designed a special smart contract that could perform multiple actions in a single transaction.

At first step, they secured a loan of 104,000 WETH from the dYdX crypto lending platform. Then they swapped the amount for STA tokens back and forth 24 times. Each transaction drained 1 percent of the STA fund from the Balancer’s pool.

So on every transaction, Balancer received less and less STA tokens as fees.

BitStarz Player Lands $2,459,124 Record Win! Could you be next big winner?

The pool did not detect the drainage due to its own limitations. DEX aggregator 1inch wrote in its Medium post that Balancer does not record the number of STA burnt after a transaction. It only keeps a tab on the token transfer.

Eventually, the STA balance on the pool declined to 1 weiSTA, an equivalent of 0.000000000000000001 STA. That led Balancer to rebalance its pool by automatically transferring the value of other tokens, including Ether, WBTC, LINK, and SNX, to STA.

How to make money exploiting DeFi protocols: do it all in one transaction ?

The attacker involved in today's exploit also used @TornadoCash to fund their initial wallet which shows that DeFi attackers are getting more sophisticated and creative. pic.twitter.com/tOX7e214tN

— Anthony Sassano | sassal.eth ?‍? (@sassal0x) June 29, 2020

The re-balancing made other tokens cheaper to purchase. Hackers exploited the event to swap their STA tokens for others, eventually draining 601.3 ETH (~$135K), 11.36 WBTC (~$103.5K), 22,593 LINK (~$103K), and 60,915 SNX (~$111k) from the pool. That amounted to nearly $452,000.

Mr. McDonald admitted that they were not aware of the nature of the attack, but clarified that they had earlier warned the community about vulnerabilities in deflationary tokens. At the same time, he confirmed concrete developments to mitigate the said risks.

“We will begin adding transfer fee tokens to the UI blacklist similarly to what we have done for no bool transfer tokens,” wrote Mr. McDonald. “Note that these lists will be non-exhaustive and any new tokens can be added to Balancer at any point.”

Not The First Crypto Exploit

The Balancer hack marked a fifth-of-its-kind attack on open-source protocols. The biggest heist among them took place in April 2020 after hackers drained $25 million out of the dForce protocol. Nevertheless, the attackers returned the funds for unknown reasons.

On the other hand, lending protocol bZx lost over $1 million in two consecutive hacking attempts in February 2020.

Tags: balancercryptoDeFiethereumSTASTONK
Tweet123Share207ShareSend
Win up to $1,000,000 in One Spin at CryptoSlots
Yashu Gola

Yashu Gola

Yashu Gola is a Mumbai-based finance journalist. He is profoundly active in the bitcoin space since 2014 – and has contributed to several cryptocurrency media outlets, including NewsBTC, FxDailyReport, Bitcoinist, and CCN. Academically, Yashu holds a bachelor's in information technology, with majors in data structures and C++ programming language. He has also won the 'Atulya Award' for his efforts towards raising $100,000 for an India-based farming project.

Related Posts

Relocation into the virtual Silicon Valley San Crypto: pros and cons, potential metrics

Relocation into the virtual Silicon Valley San Crypto: pros and cons, potential metrics

22 hours ago
The Bet is Bringing Decentralized On-Chain Gambling to Web3

The Bet is Bringing Decentralized On-Chain Gambling to Web3

2 days ago
One of 14 Companies with a DLT License Gibraltar to Launch IEO

One of 14 Companies with a DLT License Gibraltar to Launch IEO

2 days ago
10 Best Bitcoin Casino Canada: 10 Bitcoin Gambling Sites in 2023

10 Best Bitcoin Casino Canada: 10 Bitcoin Gambling Sites in 2023

3 days ago
Best Alternatives to Stake 2023

Best Alternatives to Stake 2023

3 days ago
Regulators Demonstrate Confidence in CryptoWallet Startup Despite Stricter Rules

Regulators Demonstrate Confidence in CryptoWallet Startup Despite Stricter Rules

3 days ago

Premium Partners

Play Finance

Top Casinos

BitStarz

BitStarz

Review · Visit
Punt Casino

Punt Casino

Review · Visit
Trust Dice

Trust Dice

Review · Visit
CryptoSlots

CryptoSlots

Review · Visit
mBit

mBit

Review · Visit

Sportsbooks

1xBit

1xBit

Review · Visit

Litecoin (LTC) and Dogecoin (DOGE) Drowning in Controversy While TMS Network (TMSN) Steals the Show

March 24, 2023

The Best Altcoins To Get In Early 2023: TMS Network (TMSN), TRON (TRX) and Mask Network (MASK)

March 24, 2023

The Web3.Conference will gather Web3 builders & creators this May in Amsterdam

March 24, 2023

LFi Unveils LFi Smartphone, Providing Unprecedented Access to Decentralized Financial Opportunities

March 24, 2023

Cardano (ADA) and Polkadot (DOT) Prices Reach a Crucial Juncture, While TMS Network (TMSN) Attracts Investors in Stage 2 of Presale

March 24, 2023

About Us

NewsBTC is a cryptocurrency news service that covers bitcoin news today, technical analysis & forecasts for bitcoin price and other altcoins. Here at NewsBTC, we are dedicated to enlightening everyone about bitcoin and other cryptocurrencies.

We cover BTC news related to bitcoin exchanges, bitcoin mining and price forecasts for various cryptocurrencies.

Links

Crypto Prices from Nomics

Cryptocurrency news

  • Bitcoin
  • Ethereum
  • Ripple
  • Chainlink
  • Cardano
  • EOS
  • Tezos

Technical Analysis

  • Bitcoin (BTC)
  • Ethereum (ETH)
  • Ripple (XRP)
  • Chainlink (LINK)
  • Cardano (ADA)
  • Tezos (XTZ)

Company

  • Advertising
  • Comments Policy
  • Privacy Center
  • Sitemap
  • About Us
  • Contact

© 2022 NewsBTC. All Rights Reserved.

  • News
    • Bitcoin
    • Ethereum
    • Cardano
    • Dogecoin
    • Ripple
    • DeFi
    • NFT
    • Sponsored
    • Press Releases
  • Analysis
    • Bitcoin (BTC)
    • Ethereum (ETH)
    • Cardano (ADA)
    • Chainlink (LINK)
    • Litecoin (LTC)
    • Tezos (XTZ)
    • Zcash (ZEC)
    • EOS
    • YearnFinance (YFI)
  • Trading Course
  • Directory
    • Crypto Businesses
    • Bitcoin Brokers
    • Casinos
    • Sportsbooks
  • Events
  • Play Games
  • Play Casino Games
  • Free Spins
  • Play Finance

© 2022 NewsBTC. All Rights Reserved.

This website uses cookies. By continuing to use this website you are giving consent to cookies being used. Visit our Privacy Center or Cookie Policy.