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DeFi lending platform suffers $55 million worth hack

www.thecoinrepublic.com 08 November 2021 01:51, UTC
Reading time: ~2 m

  • DeFi lending protocol bZx has been hacked and compromised its private key 
  • SlowMist has tweeted revealed that the hackers must have laundered $55 million
  • Although the private key used for  deployment on blockchain network have been compromised, the smart contracts are yet safe
  • 25% of the total stolen funds was the fund of the team behind the project

DeFi, the decentralized finance industry is one of the most potential sectors. Several globally deems that the sector can potentially take the place of our current mainstream banks. However, although the decentralized industry has the potential, it has been considered as red and hot due to its decentralized nature. We have already witnessed several hacks and scams happening, where the illicit players vanish, taking several millions of dollars from the investors. Simultaneously, bZx, a crypto lending platform has been attacked as per its official tweet. According to the official tweet by the team behind the protocol, the malicious actors have laundered about $55 million worth digital assets.

DeFi lender bZx suffers a massive hack

According to a tweet published by the DeFi lending platform, bZx, a private key controlling the platform’s deployment on blockchain was breached. Indeed, the private key was used to deploy smart contracts on the Polygon network, and Binance Smart Chain (BSC). On Friday, SlowMist, a blockchain security firm, revealed about the incident and underscored that the illegal participants had laundered $55 million. According to SlowMist, bZx private has been compromised and the firm will keep the users updated of the scenario.

Private key is compromised but the contracts are safe

The team behind bZx were thought to have vanished after the attack. However, they responded to the tweet and highlighted a private key that was used to control the protocol’s deployment on the blockchain network. Although the private key was compromised by the team, smart contracts were observed being untouched, and are working fine.

25% of the hacked figure includes the team’s funds

After the massive attack, the team behind the protocol observed that 25% of the total laundered fund was not of investors. Indeed, 25% of the stolen funds was personal hard earned money of the team behind the project. According to the tweet, 25% of the amount was from the team’s wallet that consisted of the employees personal hard earned funds. 

Notably, the DeFi protocol had already suffered three such attacks last year. However, after losing several millions of dollars, the team was able to recover only $8 million in digital assets. However, the latest attack in the DeFi sector has become one of the third largest such attacks.

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