Latest news about Bitcoin and all cryptocurrencies. Your daily crypto news habit.
The price of SPARTA token plunged 30% on Sunday as details of the attack came to light.
Spartan Protocol, a liquidity platform for synthetic assets on the Binance Smart Chain, was drained of $30 million in a coordinated attack on its liquidity pool late Saturday.Â
The exploit targeted a âflawed liquidity share calculationâ in the SPARTA/WBNB liquidity pool, which enabled the attacker to withdraw the funds, blockchain security company PeckShield explained. The security expert continued:
âIn particular, the specific hack inflates the asset balance of the pool before burning the same amount of pool tokens to claim an unnecessarily large amount of underlying assets. The consequence of this attack results in more than $30M loss from the affected pool.â
The nuts and bolts of the attack center around the manipulation of flash loans, which were used to inflate the balance of the pool before burning an equivalent amount of pool tokens.
Spartan Protocol tweeted about the exploit late Saturday, explaining that the âAttacker used $61m in BNB to overcome the pools via [...] as yet unknown economic exploit path to remove roughly $30m in funds from the pools.â
What we know so far -*Attacker used $61m in BNB to overcome the pools via a as yet unknown economic exploit path to remove roughly $30m in funds from the pools.Reach out if you can help identify and analyse the exploit.https://t.co/aNTvdzKOeFCC @RektHQ @samczsun @bneiluj
â Spartan Protocol (@SpartanProtocol) May 2, 2021
Spartan Protocolâs latest update on the matter came early Sunday, where it linked followers to the PeckShield report:
Detailed analysis of the bug in Spartan Protocol v1.Where to now?Community fund a https://t.co/mfghq1UJjH for Spartan Protocol v2.Rebuild the shield wall.https://t.co/s11s9rWTtA
â Spartan Protocol (@SpartanProtocol) May 2, 2021
The attack goes down as one of the single largest monetary exploits in decentralized finance history, according to Rekt. Only five other DeFi exploits resulted in the loss of more funds: EasyFi ($59 million), Uranium Finance ($57.2 million), KuCoin ($45 million), Alpha Finance ($37.5 million) and Meerkat Finance ($32 million).
The value of SPARTA, Spartan Protocolâs native token, plunged 30% on Sunday to $1.17. It was down over 29% in Bitcoin (BTC) comparative and 31.4% versus Ether (ETH).
Theft and exploitation are nothing new for the cryptocurrency community. In addition to the recent string of DeFi attacks, crypto criminals stole an estimated $1.9 billion in 2020, according to Finaria, an Italian publication. Fraud was the leading crypto-based crime, followed by theft and ransomware. The year before, in 2019, criminals made off with an estimated $4.5 billion worth of cryptocurrency.Â
Disclaimer
The views and opinions expressed in this article are solely those of the authors and do not reflect the views of Bitcoin Insider. Every investment and trading move involves risk - this is especially true for cryptocurrencies given their volatility. We strongly advise our readers to conduct their own research when making a decision.