Oracle Attack Sees Synthetix Token Reserves Get Inflated by Over 37 Million Due to Faulty Bot

Over the course of March 2019, it is estimated that white hat hackers were able to claim more than 40 bug bounties — with the reward sum amounting to a total of USD $23,675. Of this figure, it is estimated that ⅓ rd of the money came from a firm called ‘Tendermint’.

  • In all, it is estimated that Synthetix has lost over 37 Million of its native sETH reserves.
  • Following the Oracle attack, Synthetix’s core admin staff has put a temporary halt on all of the firm’s ongoing/future transactions.

According to an all new report released earlier today, Ethereum-based synthetic asset issuance platform ‘Synthetix’ recently fell victim to an Oracle Attack that saw the firm lose a whopping total of 37 million synthetic ETH (sETH). With that being said, it should be pointed out that the collective monetary worth of this loss is still unknown — primarily because the liquid value of sETH is still relatively unknown (on secondary markets).

For those of our readers who may be unaware of Synthetix, it is a P2P minting/trading platform that has been built atop the Ethereum blockchain. In this regard, it should be pointed out that one of the currencies that can be traded on Synthetix is the sETH token — which is essentially a digital tool that helps track the price of Ether through the use of an ‘oracle-backed price feed.’

On the subject, Kain Warwick — CEO of Synthetix — recently took to Discord to mitigate some of the damage that has been caused to his firm’s image following this latest attack.

He was quoted as saying:

“There has been an incident with the price feed of sKRW, we are currently investigating the root cause, but during the time when the price feed was returning the wrong value we believe an automated arb bot converted into sKRW and then into sETH.”

In his statement, Warwick claims that the ‘so-called attack’ was caused as a result of an automated arbitrage bot — and thus there is nothing to worry about.

As things stand, Synthetix’s core dev team is in the process of contacting the owner of the above-mentioned bot to rectify the issue.

In order to prevent such things from happening again in the future, Warwick has issued a ‘bug bounty’ so as to weed out this problem from its very root.

Synthetix currently has complete autonomous control over all of its smart contracts.

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Shiraz J
Shiraz is a multi-year cryptocurrency analyst and blockchain journalist residing in Melbourne, Australia. When he is not writing about the bitcoin ecosystem, he enjoys the art of meditation, playing the blues and traveling the world.

[Alert] Use the author's self-conducted information at your own risk, do you own research, never invest more than you are willing to lose.

[Disclosure] The published news and content on BitcoinExchangeGuide should never be used or taken as financial investment advice. Understand trading cryptocurrencies is a very high-risk activity which can result in significant losses. Editorial Policy \\ Investment Disclaimer

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