WOOFi, the decentralized Bitcoin and altcoin exchange (DEX), suffered a significant security breach on March 5, 2024. As a result, there was a loss of cryptocurrency worth $ 8.75 million. The attack specifically benefited from the Synthetic Proactive Market Making (sPMM) algorithm. So he targeted the credit market on WOOFi’s Arbitrum network. Here are the details…
That cryptocurrency exchange was attacked by altcoins
According to the autopsy report published by WOOFi, the attacker carried out a series of flash credit attacks that started around the evening of March 5. Flash loans are a feature available on certain blockchain platforms that allows users to borrow large amounts of cryptocurrency without collateral, as long as the loan is repaid within the same block of transactions.
In this case, the attacker raised large funds using flash loans. Zira borrowed approximately 7.7 million WOO tokens along with other cryptocurrencies. They then sold these borrowed tokens on WOOFi. So they manipulated the sPMM algorithm to artificially reduce the price of WOO tokens to near zero. Taking advantage of this manipulated price, the attacker quickly traded 30 million WOO tokens. It also made a profit of $8.75 million before returning the flash loans.
This exploit was quickly detected by blockchain security firms such as PeckShield, Chainalytic, and Hypernative. However, it was not possible for the attacker to lose his earnings. WOOFi took several steps in response to the attack. The platform has paused compromised contracts and is actively investigating the incident. An attempt was also made to encourage the return of stolen funds. Because they also offered a 10 percent white hat reward to the attacker. Additionally, WOOFi assures users that its WOOFi Pro, Stake and Earn services will remain unaffected and fully operational.
The price of WOO token decreased
The WOO token price dropped significantly following the attack, dropping from around $0.59 to $0.48. At the time of writing, the token is trading around $0.52. This exploit highlights the inherent vulnerabilities of DeFi platforms and the importance of robust security measures. WOOFi, along with other DeFi platforms, plans to improve security protocols to prevent similar incidents in the future. It also needs to work constantly to perform comprehensive inspections.
The incident also serves as a warning for blockchain security companies. It also highlights its critical role in detecting and reporting vulnerabilities before they are exploited by malicious actors. The DeFi ecosystem continues to grow. However, collaboration between platforms, security firms and security researchers is of great importance. Because it is vital to ensure the safety and security of user funds.
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For the rest of the article, That Altcoin Platform was Hacked: This Coin was Stolen the Most!