Decentralized Exchange Protocol KyberSwap Falls Victim to a $47 Million Hack
The decentralized exchange protocol KyberSwap has fallen victim to a hack that resulted in approximately $47 million being stolen, making it the latest casualty in the world of decentralized finance (DeFi).
🚨Urgent🚨
Dear KyberSwap Elastic Users,
We regret to inform you that KyberSwap Elastic has experienced a security incident.As a precautionary measure, we strongly advise all users to promptly withdraw their funds. Our team is diligently investigating the situation, and we…
— Kyber Network (@KyberNetwork) November 22, 2023
KyberSwap has alerted its users of a “security incident” and advised them to withdraw their funds as quickly as possible.
The Details of the KyberSwap Hack
According to on-chain data, $47 million was “unexpectedly” transferred to a single wallet belonging to the attacker. It turns out that the liquidity providers of the protocol were targeted, specifically the “Elastic Pools” of KyberSwap.
In total, $20.7 million in Arbitrum, $15 million in Optimism, $7 million in Ethereum, $3 million in Polygon, and $2 million in Base were stolen during this incident. It’s important to note that most of these funds were in various forms of Ether, such as wrapped tokens (like WETH) and liquid staking tokens.
The Hacker Sends a Message to KyberSwap
Surprisingly, an on-chain message seemingly sent by the hacker indicated that negotiations would begin “in a few hours”: “Dear KyberSwap developers, employees, DAO members, and LPs, negotiations will commence in a few hours when I am fully rested. Thank you.” – declares the hacker to KyberSwap.
As a result of the incident, KyberSwap’s Total Value Locked (TVL) plummeted by 68%, dropping from $134 million to $27 million. The Kyber Network Crystal (KNC) token also saw a 7% price drop, but has since recovered to $0.74.
The platform has pledged to provide regular updates as the team actively investigates the situation.
