Ethereum based issuer of synthetic assets, Synthetix suffered a huge Oracle attack, which leads to a loss of over 37 million synthetic Ethereum (sETH). The actual loss in traditional terms hasn’t been updated yet, as the token has poor liquidity in the market.
The news of the attack was given out by co-founder and CEO, Kain Warwick. In his official statement, Warwick said,
There has been an incident with the price feed of sKRW, we are currently investigating the root cause, but during the time when the price feed was returning the wrong value we believe an automated arb bot converted into sKRW and then into sETH.
He further added that the attack was executed automatically via an arbitrage bot. Synthetix has openly asked the owner of the bot to contact the company, Warwick added and assured that he would receive a bug bounty as a reward. As per reports, the company has total control over the smart contracts and has suspended all transfers within the system until further notice.
Attacks on crypto platforms continue to haunt the markets regularly, and the sad part is that each time millions of dollars are lost, shaking the market to the core. Even the biggest names in the industry like Binance have faced security attack resulting in severe losses. Also, the complex structures of these platforms make it difficult to retrieve the lost funds with compromising on decentralization. Crypto analyst Teo Leibowitz said,
The irony of this situation is that the currently suboptimal design of the Synthetix platform makes it’s actually very difficult to realize gains from this kind of attack.
Synthetix is on the largest synthetic assets issuer in the blockchain space and is structured a multi-tier platform. It allows users to build synthetic assets, ranging from crypto and fiat currencies to derivatives and bonds. Read more about Synthetix price prediction to know why Synthetix is a gainful investment in terms of price front.