According to Hedera, the company behind the distributed ledger Hedera Hashgraph, a smart contract attack on the Hedera mainnet resulted in the loss of several liquidity pool tokens.
Hedera announced in a tweet that the attacker focused on liquidity pool tokens on decentralized exchanges (DEXs) that derived their code from Uniswap v2 to operate with the Hedera Token Service.
Today, attackers exploited the Smart Contract Service code of the Hedera mainnet to transfer Hedera Token Service tokens held by victims’ accounts to their own account. (1/6)
— Hedera (@hedera) March 10, 2023
The Hedera team detected the suspicious activity when the attacker attempted to transfer the stolen tokens, including liquidity pool tokens on SaucerSwap, Pangolin, and HeliSwap, via the Hashport bridge. Hedera did not confirm the amount of stolen tokens, but the operators immediately suspended the bridge as a precaution.
Hedera also disabled mainnet proxies, denying users access to the mainnet, to stop the attacker from stealing more tokens. The team has determined what caused the problem and is now working on a fix.
Hedera noted that after the issue has been resolved, Hedera Council members would sign transactions to approve the installation of new code to address the vulnerability on the mainnet. The mainnet proxies will then be turned back allowing regular operations to resume.
The team recommended that token owners verify their account ID and Ethereum Virtual Machine (EVM) address balances on hashscan.io for their own assurance, as Hedera disabled proxies shortly after discovering the potential exploit.
Following the attack, Pangolin Exchange, one of the affected DEXs, advised its users to withdraw their funds immediately and promised to provide more information as soon as possible.
Due to some Hedera network irregularities, Hashport has paused their bridge, and we’d encourage anyone with HTS tokens in Pangolin Pools and Farms to withdraw immediately.
This is a time critical moment, so we’ll update as soon as we have more information
— Pangolin Hedera (@Pangolin_Hedera) March 9, 2023
As of March 9, 2023, the Hedera mainnet had successfully processed 5 billion transactions, but this recent event could potentially threaten this noteworthy achievement for the network.
#Hedera: 5 BILLION mainnet transactions!
Real transactions. Real applications. Real-world #utility. Are you watching?
We are witnessing #DLT adoption on an unprecedented scale.
This is only the beginning. pic.twitter.com/n0TbWTJmC0
— Hedera (@hedera) March 8, 2023
According to CoinmarketCap, the HBAR token is currently trading at $0.057, down 4.44% at the time of writing, with a market capitalization of $1.6 billion and a 24-hour trading volume of $58,713,575.
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