The decentralized banking platform Solv Protocol, which focuses on Bitcoin, has given a 10% bounty to a hacker who took access of one of its token vaults and stole digital assets valued at almost $2.7 million.
Fewer than 10 individuals were impacted by the scam, according to a social media post the company made about the event. Additionally, Solv promised to pay for the damages resulting from the attack, which involved 38.05 SolvBTC tokens.
When users deposit Bitcoin into the system, they obtain a token called SolvBTC, which is tied to Bitcoin. After that, the token can be used for lending, borrowing, and staking on many blockchain networks.
According to security experts, one of the platform’s smart contracts had a flaw that led to the attack. Blockchain security specialists claim that the vulnerability made it possible for the attacker to repeatedly create massive quantities of a token that was utilized in the protocol.
Before turning the tokens into about 38 SolvBTC, the hacker allegedly exploited the vulnerability 22 times.
According to Chris Dior, co-founder of CD Security, the attacker used the weakness to create hundreds of millions of tokens, which they then exchanged for assets backed by Bitcoin.
“Pyro,” a different researcher, characterized the event as a re-entrancy assault. When a smart contract handles unforeseen inputs in a way that permits attackers to repeatedly withdraw money, this kind of hack takes place.
Solv Protocol claimed it is currently collaborating with several cybersecurity companies, such as CertiK, SlowMist, and Hypernative Labs.
To bargain with the attacker, the organization has also made a wallet address publicly available. Ten percent of the stolen money will be given to the hacker as a bounty if it is returned.
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