Badger DAO, a decentralized finance protocol based on Ethereum that allows users to earn money by staking Bitcoin, has been hacked.
According to reports, the exploit cost a single user around $50 million in Bitcoin – 897 BTC. Badger’s developers have confirmed the hack. The team acknowledged the breach of protocol in a tweet and stated that they were looking into it. They also stated that all smart contracts had been paused to prevent further withdrawals.
“Badger has received reports of unauthorized withdrawals of user funds. As Badger engineers investigate this, all smart contracts have been paused to prevent further withdrawals. Our investigation is ongoing and we will release further information as soon as possible” the tweet said.
Current speculations as to what happened
Users of the system originally reported difficulties on Discord, according to an earlier Coindesk story that put the sum siphoned from the protocol at about $10 million. The hack is thought to have been carried out on Badger.com, the front-end user interface, rather than in the core protocol contracts.
According to the report, customers claimed that their wallet providers were seeking an unusually large amount of permissions to be given while attempting to connect with their Badger vaults on the website.
BADGER, the platform’s native token, has plummeted 15.3 percent since the news of the theft surfaced and is presently trading at roughly $22.73.
DeFi hacks at an all-time high in 2021
In 2021, the DeFi industry is expected to develop significantly. The sector’s overall value has just hit an all-time high of $276.92 billion. The market is presently worth $275.55 billion.
However, decentralized financial protocols and the cryptocurrency industry as a whole continue to suffer security issues. According to Cryptosec, a DeFi tracking program, there were roughly 73 DeFi exploit occurrences in 2021.
The entire sum lost is estimated to be around $1.5 billion. Over 50 of the hacked protocols were on Ethereum, the second-largest blockchain, which accounted for the majority of the attacks.
This is unsurprising, given that Ethereum is home to the most DeFi initiatives. Binance smart chain (BSC) is the second most popular cryptocurrency, with 20 attacks documented among its DeFi protocols. Poly Network, with a total value of $602 million, has been the single greatest exploit to date.