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Kyberswap Urges Liquidity Providers to Withdraw Funds
Kyber Network's Elastic Product TVL dropped by 90% after the protocol found a potential vulnerability and advised its Liquidity Providers to withdraw their funds. The multi-chain liquidity protocol confirmed the issue in a tweet stating there had been no loss of funds and the KyberSwap Classic product had not been affected.
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— Kyber Network (@KyberNetwork) April 17, 2023
Attention KyberSwap Elastic Liquidity Providers:
We have identified a potential vulnerability, and as a precaution we strongly advise all Liquidity Providers to withdraw your funds on Elastic as soon as possible.
Investigations are ongoing and no user funds are lost.
The Elastic product had a total value locked of $108 million on Sunday, but it has fallen to $11.3 million as of today, according to DefiLlama.
A separate Twitter post from the Kyber Network team announced that farming rewards are on hold until a new smart contract is in place. The temporary suspension does not affect rewards earned before April 18, 11 pm (GMT+7), which were already distributed.
Defi Attacks Are on the Rise
The Kyber Network has been hit by security issues in the past. As a result of a front-end exploit in September 2022, the protocol lost $265,000. Additionally, a Kyber Swap user received 0.05 USDT after exchanging 2 million USDC due to a routing error just a month ago.
Security threats are increasing in the DeFi space, despite its exponential growth. Over $3 billion has been lost to 125 attacks in 2022, according to Chainalysis.
There has been an increase in hacks and exploits this year as well. There were several attacks on DeFi protocols in 2023, including the Euler Finance - Allbridge flash loan attack, Sentiment liquidity protocol hack, and Hundred Finance's $7 million security breach in Optimism. However, Euler Labs and Allbridge have moved forward after hackers voluntarily returned funds in two separate exploits.
Kyber Network ($KNC) is trading at $0.7813, up 0.53% in 24 hours.
What is Kyber Network:
Kyber Network is a multi-chain cryptocurrency trading and liquidity hub that connects liquidity from various sources to enable trades at the best possible rates. Kyber Network can be integrated into decentralized applications (dApps), cryptocurrency wallets, and platforms for decentralized finance (DeFi).
Learn more about KyberNetwork:
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