On thursday, august 17, 2023, exactly protocol, a decentralized finance (defi) project, experienced a hacking incident that resulted in a security compromise in the optimism layer 2 network. This attack was successfully exploited by a hacker who exploited a vulnerability in their smart contract.
A number of security firms, including blocksec and beosin, along with the exactly protocol team and the optimism team, successfully detected this attack. Blockec revealed that the attackers managed to withdraw more than $7 million from the protocol by manipulating interest rate calculations and overprinting tokens.
The exactly protocol and optimism development teams simultaneously issued statements condemning the incident and asking users to immediately withdraw their funds from the protocol as a precautionary measure. While it is expected that there will be a full security audit to identify the loopholes used by the hackers, the technical details of how the hack was carried out have not been publicly disclosed.
Nonetheless, some security analysts suspect that attackers may be utilizing reentrancy bugs or flash credit attacks, which are common methods often used in attacks against defi protocols.
Layer 2 optimism, a network developed as a scaling solution for the ethereum network, aims to increase transaction speed and efficiency by executing transactions at a separate layer before they are periodically placed on the ethereum main chain. It offers lower transaction fees as well as faster transaction confirmation compared to the ethereum network, making it an attractive option for defi applications.
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