DeFi-Balancer Protocol was compromised, which resulted in his pools had lost at least half a million dollars.
«Apparently, someone emptied consisting of WETH and the STA pool Balancer, giving $500 000 in in WETH,» – said one of the first analyst Steven Zheng.
Apparently someone drained a Balancer Pool made up of WETH and STA and got away with $500k worth of WETH. pic.twitter.com/SKshyDXagi
— Steven (@Dogetoshi) June 28, 2020
Information about the attack was also confirmed by representatives of the exchange 1inch and co-founder Balancer Labs Mike McDonald. According to the 1inch, the attacker manipulated a smart contract Balancer, which led to a shortage of funds in the pools.
«The funds were used for the exchange of WETH to STA and back 24 times. The result of the STA pool was devastated. At each exchange WETH on STA pool Balancer received 1% less STA than anticipated,» explains the exchange.
Using the scheme described above, a hacker could freely withdraw from the smart contract Balancer tokens WETH, WBTC, SNX and LINK. The attack was made possible because of the built-in STA mechanism of deflation, destroying 1% of transmitted with each transaction amount.
1inch believe that the organizer of the attack is «a very advanced developer of smart contracts, with a deep knowledge and understanding of the leading DeFi-protocols». His identity was not possible, so as to conceal the traces he used Ethereum-mixer Tornado Cash.
The investor believes Digital Currency Group Larry Sukernik, DeFi products in their current form are too complicated and can bring users more harm than good.
«A high level of intelligence can become an obstacle to creating a successful product. Develop these people products are often outstanding, but unusable mass consumer,» he said.