The decentralized exchange, KyberSwap has been compromised for around $46 million across multiple blockchains in a concerning development within the DeFi space. The increasing number of hacks in the DeFi world has continued to bother the crypto community.
Quick Take:
- KyberSwap suffers a loss of $46 million across multiple chains in a crypto hack.
- Hackers leave an on-chain message, toward negotiations with the platform.
- The TVL of the platform tanks by more than 70%.
As per the update given by KyberSwap, the hacking attempt was aimed at KyberSwap Elastic. The platform also advised users to withdraw their funds as a precautionary measure. However, it added that the team is investigating the situation to find out potential loopholes.
The security breach resulted in the draining of almost $46 million in various crypto assets. On the other hand, many blockchain analytic firms figured that the attacker also left some on-chain messages to hint toward negotiations with the platform. Plus, some wallet addresses of the exploiter were still active.
The message read,
“Negotiations will start in a few hours when I am fully rested.”
A number of cryptocurrencies were drained from the platform in this incident. These include approximately $20 million in Wrapped Ether (wETH), $7 million in Wrapped Lido-Staked Ether (wstETH) and $4 million in Arbitrum (ARB).
The report also suggests that these funds were split across multiple chains. These included Arbitrum, Optimism, Ethereum, and Base. The chain that suffered the most impact was Arbitrum followed Optimism.
The TVL of KyberSwap Tanks by Over 70%
As data from DefiLlama shows the total value locked on KyberSwap has dropped by 68% within a few hours. Moreover, only around $8.53 million is left on the platform due to the exploit. Users are also withdrawing funds from the platform at a fast pace.
The platform reached its peak TVL of $134 million earlier this year. However, the recent hacking attempt has left the TVL in tatters. In addition, the Kyber Network Crystal KNC token also witnessed a slight dump in its trading price.
The slump in the KNC token’s trading price indicates that the market is still quite sensitive to such events and incidents. Moreover, such incidents further complicate the case of crypto in front of regulators. With the ongoing regulatory scrutiny, regulators are aiming to tighten their grip on crypto platforms and exchanges.
Previously, the KyberSwap team identified a systematic vulnerability in April. They encouraged users to withdraw liquidity but fortunately, no funds were lost in that incident.
The increasing number of DeFi hacks is becoming a major point of concern for the crypto community. Many users are now unwilling to put up with the risky nature of the DeFi space. However, platforms encourage users to remain vigilant of any potential scams or vulnerabilities in the DeFi ecosystem.
