Approximately $46 million in various cryptocurrencies has reportedly been siphoned from KyberSwap, a decentralized exchange, in a recent decentralized finance (DeFi) security breach.
On November 23, the team behind Kyber Network issued a warning to its users via a post on X (formerly known as Twitter), announcing that KyberSwap Elastic had suffered a security incident. As a precautionary measure, they advised users to withdraw their funds and stated that they were actively investigating the situation.
Blockchain analysts have pinpointed the wallet addresses involved in the incident, noting that they were still active recently. Data from Debank indicates that the stolen assets include about $20 million in Wrapped Ether (wETH), $7 million in Wrapped Lido-staked Ether (wstETH), and $4 million in Arbitrum (ARB). The stolen funds were distributed across multiple blockchain networks, including Arbitrum, Optimism, Ethereum, Polygon, and Base.
Blockchain expert Spreek, in a post on X, expressed confidence that the issue was not related to user approvals but was specific to the Total Value Locked (TVL) in Kyber’s pools. The attacker also left a message on the blockchain, suggesting an intention to start negotiations with the protocol developers and DAO members after a period of rest.
Following the attack, data from DefiLlama showed a significant drop in KyberSwap’s TVL, decreasing by 68% in just a few hours. The platform experienced an outflow of nearly $78 million due to the hack and subsequent user withdrawals. As a result, KyberSwap’s TVL plummeted to $27 million, a stark contrast to its 2023 peak of $134 million.
The price of Kyber Network Crystal (KNC), the native token of Kyber Network, experienced a brief 7% decline following news of the exploit but has since stabilized, trading around $0.74.
This incident follows a previous vulnerability identified by the Kyber team in April, during which they advised users to withdraw their liquidity. Fortunately, no funds were lost in that earlier incident.
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