Hackers Exploit DeFi Project to Mint 4 Quadrillion in Crypto

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The Ankr DeFi project was hacked for nearly $5 million, and the price of its mainstay coin is now barely worth over $1.

The Ankr DeFi project was hacked for near­ly $5 mil­lion, and the price of its main­stay coin is now bare­ly worth over $1.
Image: Zarko Prusac (Get­ty Images)

Just how far will hack­ers go to eek out a prof­it from a cryp­to enti­ty? In one DeFi projects’ case, those look­ing to exploit found they could make a pret­ty pen­ny by sim­ply telling the sys­tem to mint a quadrillion cryp­to tokens.

Binance CEO Cheng­peng Zhao, who often goes by CZ, wrote ear­ly Tues­day there were “pos­si­ble hacks” of the Ankr and Hay coins list­ed on the exchange. He said the hack­er “updat­ed the smart con­tract to a more mali­cious one.” The CEO added that he paused with­drawals for Ankr’s loy­al­ty token aBNBc.

Accord­ing to cryp­to secu­ri­ty ana­lyt­ics firm Peck­Shield, the hack­er man­aged to dig into the smart contract’s code and exploit a bug that let him mint an unlim­it­ed amount of Ankr’s main token. The hack­er and sub­se­quent folks look­ing to exploit the DeFi project decid­ed to keep going until some­where around 4 quadrillion had been mint­ed. To put that in per­spec­tive, that is a ludi­crous 4,000 tril­lion tokens. 

Ankr also wrote on Twit­ter late Thurs­day explain­ing that its aBNB token had been exploit­ed, and tried to reas­sure users that its oth­er ser­vices were unaf­fect­ed. After the dust set­tled, ana­lysts said the project could have been tak­en for about $5 mil­lion, even before Ankr made its ini­tial announce­ment. Still, it offered some very con­cern­ing advice to cus­tomers while advis­ing it will reis­sue hacked coins. Accord­ing to cryp­to ana­lyst firm Lookon­chain, anoth­er user man­aged to take advan­tage in the lull between when prices were being authen­ti­cat­ed on oth­er sites. This sep­a­rate exploiter took 10 BNB tokens, which are Binance’s native coin, and turn what was just $2,879 into $15.5 mil­lion worth of BUSD (a sta­ble­coin pegged to the U.S. dollar). 

Ankr also wrote on Twit­ter late Thurs­day explain­ing that its aBNB token had been exploit­ed, and tried to reas­sure users that its oth­er ser­vices were unaf­fect­ed. After the dust set­tled, ana­lysts said the project could have been tak­en for about $5 mil­lion, even before Ankr made its ini­tial announce­ment. Still, it offered some very con­cern­ing advice to cus­tomers while advis­ing it will reis­sue hacked coins. 

As point­ed out by Coin­Desk, the hack prac­ti­cal­ly drained all the aBN­Bc liq­uid­i­ty out of Ankre, and since then the val­ue of the coin has sunk by over 99% and its cur­rent val­ue is hov­er­ing around $1.50, accord­ing to CoinGecko. On the flip side, Hay is a sta­ble­coin sup­posed to be pegged 1‑to‑1 with the val­ue of the U.S. dollar. 

Binance remains the largest cryp­to exchange by far, with a trad­ing vol­ume of around $12 bil­lion, as of report­ing. The only oth­er exchange to break $1 bil­lion is Coin­base, but that exchange is also feel­ing the pres­sure of a world becom­ing more crit­i­cal of cen­tral­ized cryp­to store­hous­es. What had been Binance’s main rival for some time, FTX, recent­ly implod­ed and is already tak­ing oth­er major actors in the cryp­to space down with it. 

Binance itself has expe­ri­enced oth­er hacks this year as well. In May, hack­ers took 7,000 bit­coin worth around $40 mil­lion at the time after they breached a wal­let list­ed on Binance. In Octo­ber, Binance suf­fered a hack of its native BNB token worth some­where between $100 to $110 million. 

It’s inter­est­ing to note just how many exchanges have died since the start of the year. Cel­sius and Voy­ager are both going through messy bank­rupt­cy pro­ceed­ings, and of course there’s FTX whose incred­i­ble implo­sion has brought down cryp­to lender Block­Fi. Binance’s own chief strat­e­gy offi­cer Patrick Hill­man told Coin­Desk on Thurs­day that their own cen­tral­ized exchange might not be around in 10 years, as more of the cryp­to world may try to leave these exchanges behind for the green­er pas­tures of the DeFi space. CZ took umbrage with the line that their exchange could be gone in the next decade, but didn’t explic­it­ly deny it either. Of course, let’s not for­get that decen­tral­ized finance ini­tia­tives have been a pri­ma­ry tar­get for hacks this year. 



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