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Friday, July 19, 2024

Poly Network Suspends Services After Getting Hacked

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The cross-chain decentralized finance (DeFi) platform – Poly Network – announced on Twitter that it had halted operations due to a “recent attack.” The team revealed that the exploit affected 57 cryptocurrencies on 10 blockchains, advising users to “promptly withdraw liquidity from decentralized exchanges.”

Poly Network experienced another similar hack in 2021 when wrongdoers drained around $600 million worth of digital assets.

Trying to Solve the Problem

Poly Network said it had requested the assistance of “cybersecurity professionals and individuals with relevant knowledge” and urged users with any information to share it with the team.

The 57 affected cryptocurrencies include Shiba Inu (SHIB), Dai (DAI), and many more. Despite not disclosing the exact scope of the exploit, some presumed the sum could be substantial. Blockchain security firm Dedaub claimed hackers compromised the addresses’ private keys.

At one point, there were reports that the hack was worth $34 billion. In reality, though, the attacker managed to mint this amount, almost all of it was on the Ethereum Layer 2 blockchain Metis, but they weren’t able to withdraw it due to a lack of liquidity.

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Dedaub added that the breach “wasn’t complex” and that the attacker used keys to sign proof that they were owed Binance Coin (BNB). The total realized gain for the wrongdoer was approximately $5.5 million.

Poly Network said it will try to join forces with centralized exchanges and law enforcement agencies on the case. It raised hopes that the attacker will return the stolen assets to avoid potential legal troubles.

To minimize additional risks for customers, the DeFi platform urged those holding the affected assets “to expedite the process of withdrawing liquidity and unlocking their LP tokens.”

“Please remain calm and trust that we are committed to safeguarding your assets,” the team concluded.

CZ Chips in

The CEO of Binance – Changpeng Zhao (CZ) – was among the people to react to the latest attack in the DeFi space. He shared figures from Lookonchain, according to which the Poly Network hackers have sold 94B SHIB for 360 ETH, 495M COOK for 16 ETH, and 15M RFuel for 27 ETH.

He assured that the incident will not reflect on Binance users since the platform does not support deposits from the compromised protocol. The exec also said the exchange has already provided Poly Network assistance in fixing the problem.

The Previous Major Hack

Poly Network has a bad record with similar hacks, becoming a victim of a $600 million exploit in 2021 (one of the biggest in the history of DeFi). Specifically, the wrongdoers siphoned $266.6 million worth of digital currencies from the Ethereum network, $252 million from Binance Smart Chain (BSC), and $85 million from Polygon.

In a sudden twist of events, though, the attackers returned some of the drained assets, starting with a $260 million tranche. Some crypto tracking firms like Chainalysis and Elliptic claimed the person/or people behind the attack did it “for fun” and wanted to “expose the vulnerability” of the network before others find its cracks. In the aftermath, the hackers returned the full amount a few weeks later.

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