Thorchain (RUNE) Tested, Network Gets Halted After Being Attacked for 4k ETH

Only ETH LPs were affected who will be made whole assured the team while noting that this disappointing event, in which the decentralized system got halted due to certain thresholds being hit, will only make the network “stronger and more resilient.”

On Thursday, Thorchain suffered an attack resulting in the loss of about 4,000 ETH from the trading protocol, less than 13,000 ETH as previously suspected.

What happened was ETH Bitfrost was tricked using a custom wrapper to read a deposit amount of 200 when it was actually zero.

“The attacker paid huge slip fees, approx $1.4m was captured by nodes, with further $1.4m by ERC20 LPs. Only users affected are ETH LPs, and they will be made whole. So despite the exploit, Nodes, LPs, and Arbers will stand to profit considerably,” noted @Thorchain on Twitter.

The community developers discovered the issue and anonymous nodes reportedly voluntarily stopped their nodes. With 1/3rd of the nodes halted, the network got paused.

Explaining just how the decentralized system got halted, Thorchain said that it is decentralized with certain thresholds that require 67% of 38 nodes to run and gets halted if 33% of 38 nodes halt.

“These nodes are anonymous and anyone can become one (with minimum bond amounts). No individual (or minority) can affect the system.”

The loss of about $5 million will be borne by the Thorchain treasury, which will be distributed to the ETH liquidity providers.

The team is already working on the recovery plan with a fix for the bug already released and approved. Now, lost funds will be restored, an automatic-solvency checker will be released, and the team will work with security firms for audits.

While a disappointing event, the Thorchain team noted that it would only make the network “stronger and more resilient.”

The news of the exploit and in tandem with the weakness in Bitcoin and the broad cryptocurrency market has sent the price of RUNE crashing by 20% in the past 24 hours.

As of writing, RUNE is trading at $4.61, down nearly 78% from its all-time high of $20.87 two months back.

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