September 30, 2023



THORChain DeFi project Suspended due to hacker attack

The THORChain protocol lost, according to preliminary estimates, $4.9 million in cryptocurrency due to a hacker attack. To eliminate the consequences of the incident, all operations in the network are suspended based on the consensus of the node.

The THORChain DeFi project is a liquidity protocol that allows exchanging assets of various blockchains among themselves without having to transfer them to a third party.

Earlier, the project team reported that the attackers withdrew 13,000 ETH (~$24.76 million at the time of writing) from the protocol. Then this amount was adjusted to 4000 ETH (~$7.62 million).

According to the data collected by the community, the damage was lower — less than $5 million. At the address marked by the Etherscan service as involved in the attack, there are assets worth $4.58 million.

The project team promised to tell in detail about the incident when they find out all the details. It is known that the attackers were able to “deceive” the Bifrost service, which is responsible for connecting nodes to blockchains and implementing witness transactions.

ETH Bifrost was tricked using a custom wrapper to read a deposit amount of 200 when it was actually zero. More details will be provided in the upcoming post mortem blog.

“ETH Bitfrost was deceived by a custom wrapper, which forced him to consider the deposit amount equal to 200, when in fact it was zero,” said a community member under the nickname THORchain.BULL.

The technical director of the project, Chad Barraford, said that the THORChain team had already discovered an error in the code base and made a proposal to improve the protocol. If the community approves the changes, the developers will implement the patch within 24 hours and resume operations on the network.

The project team noted that the THORChain reserve fund has enough funds to cover the losses of Ethereum liquidity providers. However, the developers asked the organizers of the attack to get in touch with them to “discuss the refund and payment of adequate remuneration for the discovery of the vulnerability.”

The developers also reported that the attackers had to pay large commissions for the attack — about $1.4 million to nodes and the same amount to ERC-20 token liquidity providers.

THORChain stressed that the project is now working in the Chaosnet test network, designed for “combat tests”, and therefore attacks “were inevitable and always calculated.”

“It’s better to have 50 successful attacks now than one in a few years,” said the developer with the nickname Bitcoin_Sage.

The RUNE project’s own token occupies the 64th line of the CoinGecko rating with a capitalization of $ 1.3 billion. Over the past day, its price has decreased by more than 14%. At the time of writing, the asset is trading at $4.79.

The RUNE/USDT hourly chart of the Binance exchange. Data: TradingView.

Earlier, hackers withdrew more than $4 million in cryptocurrency from various DeFi projects due to a vulnerability in the smart contract of the ChainSwap interconnect bridge.

Recall that in June, the SafeDollar DeFi protocol on the Polygon blockchain was subjected to a hacker attack, and its stablecoin depreciated. The attackers took advantage of a vulnerability that allowed them to issue an asset in unlimited quantities.