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Decentralized cryptocurrency exchange KyberSwap announced that hackers attacked its liquidity pool, stealing the equivalent of $47 million.
"Urgent announcement. We regret to inform you that KyberSwap Elastic has encountered a security incident. As a precaution, we strongly recommend that users withdraw their funds immediately," the official Kyber Network account announced on X on the morning of November 23.
Kyber representative said that they are still working on the issue and have no further comment.
The Block Blockchain data shows that the platform's liquidity pools - a term used to describe places that provide liquidity for cryptocurrency trading activities - were largely drained by bad actors.
The hackers took $7 million worth of Ethereum, $20.7 million worth of Arbitrum, about $15 million worth of Optimism, $3 million worth of Polygon, and about $2 million worth of Base. The total loss of assets was more than $47 million, all sent to a single wallet address.
Illustration with Kyber Network logo (Source:BeIn Crypto)
After the attack, the hacker left a message: "To the KyberSwap project development team, staff, DAO members and Liquidity Pool. Negotiations can start in a few hours, after I have rested."
"It looks like the hacker just drained liquidity in the pools and I don't think the issue is related to Kyber's approval engine," wrote 0xngmi, a member of the crypto data analytics site DefiLlama, on X.
Meanwhile, data from DefiLlama shows that total user deposits into Kyber's project dropped from $86 million to $27 million after the KyberSwap Elastic hack was announced, indicating a massive withdrawal from the platform.
Kyber Network’s KNC token price also fluctuated sharply from $0.756 at 6:00 AM to $0.721. The token is currently trading at $0.725.
Kyber Network token price fluctuations on the morning of November 23 (Source:Coinmarketcap)
Kyber Network was founded in 2017 by three co-founders Loi Luu, Victor Tran and Yaron Velner. This is one of the first blockchain projects developed by Vietnamese people and has attracted great attention in the international community.
The project raised $52 million in an ICO. KyberNetwork's main products are the decentralized exchange KyberSwap and the digital asset management platform Krystal.
According to Coinmarketcap rankings, KyberSwap Elastic is ranked 25th in the global cryptocurrency market, with a total trading volume of 31.6 million USD in the past 24 hours, accounting for 0.592% of the market share.
Previously, on April 17, Kyber Network also issued a notice that users should withdraw money from the exchange as soon as possible due to discovering a potential vulnerability in the exchange's contract.
Last September, Kyber also confirmed that hackers exploited a vulnerability in the front-end interface on KyberSwap, stealing $265,000 worth of cryptocurrency from two user wallets.
According to VnExpress