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Crime and Investigations

Decentralized Exchange KyberSwap Hit by $47M Security Breach

Decentralized Exchange KyberSwap Hit by $47M Security Breach

KyberSwap, a decentralized exchange protocol, found itself in the midst of a security breach resulting in a substantial reported loss of around $47 million from its Elastic Pools liquidity solution.

The incident sparked concern as funds were unexpectedly siphoned off to a single wallet, spanning across various networks including Arbitrum, Optimism, Ethereum, Polygon, and Base.

The majority of these diverted funds were held in diverse forms of ether and tokens, compelling KyberSwap to swiftly advise its user base to initiate withdrawals, citing a critical “security incident.”

Notably, despite this setback, KyberSwap Elastic’s innovative functionality stands out, empowering liquidity providers to independently set their preferred price ranges while ensuring that their yields continue to compound seamlessly.

Moreover, experts analyzing the breach suspect a targeted approach aimed at draining liquidity provider pools rather than exploiting any vulnerability in the approval process.

Impressively, the overall value locked within the protocol appears to remain stable at $72 million, indicating minimal impact from the breach.

READ MORE: Crypto Exchange Bittrex Global is Ceasing Operations

Insights gleaned from the investigation suggest the exploit’s complexity, involving sophisticated sequences that potentially leverage flash loans and intricate transaction maneuvers.

These transactions reportedly commence with incoming ETH balances and encompass a series of strategic actions, including minting, redeeming, and swapping operations, revealing the meticulousness behind the exploit’s execution.

Alexander Stefanov

Reporter at CoinsPress

Alex is an experienced finance journalist and a cryptocurrency and blockchain enthusiast. With over five years of experience covering the industry, he deeply understands the complex and constantly evolving world of digital assets. His insightful and thought-provoking articles provide readers with a clear picture of the latest developments and trends in the market. His passionate approach allows him to break down complex ideas into accessible and insightful content. Follow up on his content to be up to date with the most important trends and topics - stay ahead of the curve with CoinsPress.

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