Over 1.2 Billion aUSD Minted in an Exploit of Polkadot’s DeFi Hub Acala

Animoca Brands Subsidiary Loses $18 Million in a Hot Wallet Hack

Polkadot’s decentralized finance (DeFi) hub Acala suffered a significant assault on its newly launched liquidity pool on Sunday. The exploit allowed the hacker to mint greater than 1.2 billion aUSD, the challenge’s stablecoin. 

Shortly after the hack, the Acala group up to date customers on Twitter, noting that the exploit originated from a “misconfiguration of the iBTC/aUSD liquidity pool.” The misconfiguration has now been rectified, in accordance with the challenge. 

Acala Suspends On-chain Activities

Onchain knowledge reveals that the majority of the minted stablecoins are nonetheless in the Acala account. The attacker swapped a tiny fraction of the stablecoins for Acala’s native token ACA and 4 different tokens. At the time of writing, the account was holding about $1.27 billion price of aUSD, representing greater than 99% of the minted tokens. 

While the Acala group is but to make a last resolution on the exploit, the group famous that it had suspended the accounts concerned from transferring the tokens. 

According to the challenge, on-chain actions corresponding to swaps and cross-chain messaging have additionally been halted for different customers till additional discover. The protocol famous that its oracle pallet was additionally suspended, so customers shouldn’t have to fret about pressured liquidation. 

Meanwhile, aUSD, the primary stablecoin on Polkadot, reacted negatively to the incident and misplaced its USD parity. After dropping by nearly 50% to a buying and selling value of $0.57, the stablecoin traded at $0.89 at press time.

Acala’s Attack Might Not be the End

Although Acala has rectified the misconfiguration in its pool, the incident provides to the quantity of decentralized purposes (dApps) which have fallen sufferer to hackers who at all times look out for sensible contract bugs to use. 

Victor Young, the founder of Analog, a layer-0, proof-of-time (PoT)-based challenge, commented on the Acala hack, noting that Polkadot is “safe by design” on account of its relay chain, however the identical can’t be mentioned about parachains 

He said that such dApp exploits may happen in the longer term if sensible contract builders don’t frequently verify their codes. 

“In my view, we’ll proceed to see extra of these assaults as a result of many dApp builders don’t put in the legwork when defining their code’s safety properties. Even if the sensible contract is audited, the code will not be foolproof. In this regard, builders and QA consultants have to repeatedly consider to make sure the code achieves its aims,” he mentioned.


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