KyberSwap Loses $46M in DeFi Heist – Sparks Major Security Crisis

KyberSwap Loses $46M

TL;DR

  • KyberSwap Elastic is experiencing a security breach resulting in a $46M loss and thus advises users to withdraw their crypto funds.
  • The DeFi heist has led to KyberSwap’s TVL dropping from $87M to $8M. Moreover, KNC’s price dropped by 7.6%, with analysts anticipating a further decline.

KyberSwap Elastic Loses $46M in Major Security Breach

The Decentralized Exchange (DEX) KyberSwap Elastic joins a list of DeFi protocols that hackers have compromised.

KyberSwap loses $46M in a major security breach.
KyberSwap loses $46M to a major security breach | Source: KyberSwap Network

The platform suffers a major security incident affecting all supported networks, leading to an urgent advisory for users to withdraw their funds.

The breach caused substantial losses, compromising approximately $46M in several crypto assets, including Wrapped Ether.

The Kyber Network team, in a post on social media platform X, issued an alert warning its users that KyberSwap Elastic is now a compromised area.

The alert was also echoed by PeckShieldAlert, expressing concern and support for the KyberSwap community.

It has made the price of the KNC Kyber Network’s native token plummet by 7.6%. The incident may further negatively impact its price in the following period.

Details of the KyberSwap Elastic $46 Million Hack

Lookonchain data pinpoints all the affected and exploiter wallet addresses that are still active following the breach.

It also reveals all the stolen assets amounting to $46 million. The hack involves $20M in Wrapped Ether (wETH), $7M in wrapped Lido-staked Ester (wstETH), and $4M in Arbitrum (ARB).

KyberSwap gets exploited for $46M in a major security breach.
KyberSwap exploited for $46M in assets | Source: Lookonchain

The attackers dispersed the stolen funds across multiple chains, including Optimism, Ethereum, Arbitrum, Polygon and Base.

Kyber Network is actively investigating the incident and will provide regular updates to its users.

The hacking incident has impacted KyberSwap’s Total Value Locked (TVL). It dropped from over $87 million to around $8 million, according to DeFiLIama data.

It appears that the price of KNC wouldn’t break the $1 area and may experience a further downtrend to another bear market low below $0.45

Crypto Cyber Attacks Keep Rising

This is not the first time the DeFi sector and the whole crypto space have experienced crypto cyber attacks. On July 30, 2023, hackers exploited Curve liquidity pools.

They found a vulnerability that caused the Curve exploit, leading to a $47M loss across several decentralized finance (DeFi) protocols.

In addition to this, on September 25, 2023, a hacker successfully withdrew 5,000 ETH worth approximately $8 million from one of HTX’s hot wallets.

In a shocking aftermath, HTX (Houbi) recovered funds from hackers with a 250 ETH bounty. The HTX advisor, Justin Sun, suggested the hacker remains with 5% of the stolen funds in exchange for their return.

The expansive nature of the KyberSwap hack reminds crypto investors of the vulnerabilities in the DeFi sector and how crypto attacks are on the rise.

It also highlights the importance of tight security measures to secure assets in the fast-evolving crypto sphere.

More than that, it underscores the difficulty in safeguarding the funds users entrust to these platforms.

Do you think KyberSwap Elastic will ever recover from this hack?