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Cryptocurrency exchange aggregator 1inch recently experienced a security incident where it lost around $5 million. The hacking was traced back to the employment of old Fusion v1 smart contracts, creating an opening that enabled the attackers to take out funds.
Breakdown of the Attack
The exploit caused about:
2.4 million USDC
1,276 WETH
Even after the great loss, 1inch has assured that users’ individual funds are secure, since the hack mostly affected legacy resolver contracts.
1inch’s Response and Next Steps
As a way of reducing risks further, 1inch is actively engaged with impacted resolvers and pushing them to update their contracts. The platform has also initiated a bug bounty program, calling on security researchers to find vulnerabilities and assist in retrieving the stolen money.
Lessons from the Exploit
This event highlights the need for:
Keeping smart contracts current to avoid known vulnerabilities.
Regular security scanning to detect and fix vulnerabilities.
Promoting community-led security such as bug bounties.
The DeFi ecosystem continues to struggle with security issues, and this attack serves as a warning to projects to focus more on smart contract security. 1inch’s initial response to issuing a bug bounty program will help recover some funds and build security against any subsequent attacks.
Keep up the updates with the latest development from 1inch as they get to rectify the issue and improve on security.
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