Is Binance Smart Chain Safe? Two Flash Loan Exploit in a Week

Is Binance Smart Chain Safe? Two Flash Loan Exploit in a Week

Binance Smart Chain decentralized finance ecosystem experienced a flash loan exploit for the second time in a week after PancakeBunny. However, a new attack drained $3 million from DeFi platform Bogged Finance. Moreover, the team confirmed the attack on Sunday, warning users not to purchase its native token until the problem is solved.

More so, the developer team found and mitigated the exploit in 45 seconds, or 15 blocks. More so, the culprit drained $3 million of the $6 million liquidity. Even more, the BOG token price crashed from over $1.8 to $0.0003 proceeding with the attack. According to CoinMarketCap, the BOG price is at $0.0002146, at the time of writing.

Bogged Finance enables users to place a limit order on any BSC-based tokens. In addition, the team shared information of the attack in a Medium post:

“The attacker was able to utilize flash loans to exploit a flaw in the staking section of the BOG smart contract to manipulate the staking rewards and cause an inflation of supply — without the transaction fee being charged and burned — causing net inflation.”

Even more, the transaction limit of 47,500 BOG has reduced the automated process of the attacker and mitigated the damage potentially, as per the team. Moreover, in 45 seconds prior the lead developer patched the exploit by disabling the transaction fee, the hacker made a total of 11 transactions and made off 11,358 Binance Coin (BNB).

Added to this, the team works on migrating the liquidity to a new contract by utilizing the exploit the attacker utilized. However, it will dispose of an updated version of the contract to BSC. After burning over 7.5 million previously minted tokens during the migration, Bogged Finance will airdrop the liquidity token of the holder.

In case, users paid for their BOG, the platform’s native token, it is safe, the announcement reassures. More so, the team expects a smaller circulating supply after the whole process, which will take 48 hours.

PancakeBunny is the most popular Binance Smart Chain (BSC)-based decentralized finance (DeFi) protocol. It has suffered a major exploit that allowed hackers to make off with over $200 million crypto belongings. 

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Cryptocurrency and blockchain tech interest has enticed Carolyna to write for NewsCrypto. She made her personal mission to help non-crypto geeks to understand the technology with ease.