April 19, 2022 at 3:10 AM
Hackers stole $182 million from an Ethereum-based stablecoin protocol in what’s yet another attack on a crypto project.
On Sunday, cybersecurity firm PeckShield reported the attack on Beanstalk Farms, saying hackers stole more than $80 million for themselves, but the protocol’s losses appeared to be even higher. The company later said its initial analysis showed the losses amounted to around $182 million.
An hour after the hack was reported, Beanstalk confirmed it had been hacked in a tweet saying it had “suffered an exploit” and it was “investigating the attack.”
On Beanstalk’s official Discord channel, Publius, one of the developers of the project, commented on the hack, saying: Honestly not sure what to type. We are fucked. This project has not had any venture backing, so it is highly unlikely there is any sort of bail out coming.”
“Really a horrible day,” he added. “There are no funds left. [...] they minted enough Beans to sell them and drain the liquidity on all pools.”
Because crypto can be so volatile, numerous stablecoin projects have popped up to provide even-keeled refuge for traders in the complex world of decentralized finance, or DeFi. Beanstalk did not seek to back its peg with cash reserves, but rather constructed financial incentives for protocol participants, who loan the platform tokens in return for a yield. The hack has caused the stablecoin Bean to break its $1 peg dramatically, and it currently trades at $.156 according to data from CoinGecko.
On Discord, the company shared more details of the hack. “An attacker was able to exploit Beanstalk and transfer all of the assets in the contract to their wallet,” the company wrote.
In short, the hackers did a “rogue update proposal” that sent all the funds to the hackers’ wallet, “that was passed with the power of a flash loan,” according to Tal Be’ery, a cybersecurity researcher and the chief technology officer of ZenGo. In other words, the hacker used a flash loan—a buzzy tool in DeFi that lets users take out an instant uncollateralize
On Sunday, cybersecurity firm PeckShield reported the attack on Beanstalk Farms, saying hackers stole more than $80 million for themselves, but the protocol’s losses appeared to be even higher. The company later said its initial analysis showed the losses amounted to around $182 million.
An hour after the hack was reported, Beanstalk confirmed it had been hacked in a tweet saying it had “suffered an exploit” and it was “investigating the attack.”
On Beanstalk’s official Discord channel, Publius, one of the developers of the project, commented on the hack, saying: Honestly not sure what to type. We are fucked. This project has not had any venture backing, so it is highly unlikely there is any sort of bail out coming.”
“Really a horrible day,” he added. “There are no funds left. [...] they minted enough Beans to sell them and drain the liquidity on all pools.”
Because crypto can be so volatile, numerous stablecoin projects have popped up to provide even-keeled refuge for traders in the complex world of decentralized finance, or DeFi. Beanstalk did not seek to back its peg with cash reserves, but rather constructed financial incentives for protocol participants, who loan the platform tokens in return for a yield. The hack has caused the stablecoin Bean to break its $1 peg dramatically, and it currently trades at $.156 according to data from CoinGecko.
On Discord, the company shared more details of the hack. “An attacker was able to exploit Beanstalk and transfer all of the assets in the contract to their wallet,” the company wrote.
In short, the hackers did a “rogue update proposal” that sent all the funds to the hackers’ wallet, “that was passed with the power of a flash loan,” according to Tal Be’ery, a cybersecurity researcher and the chief technology officer of ZenGo. In other words, the hacker used a flash loan—a buzzy tool in DeFi that lets users take out an instant uncollateralize
