The MonoX decentralized finance protocol (DeFi) was the victim of a hacker attack on Monday (30). The action resulted in the theft of Wrapped Ether (WETH) and Polygon (MATIC) tokens. In total, the hacker managed to take US$ 30 million, or R$ 151 million at the current price.
MonoX confirmed the attack through twitter and hired the services of Halborn Security to locate the perpetrators of the theft. The team also seeks to contact the hacker to offer a reward if he returns the funds.
contract failure
According to the protocol, the failure occurred because of an exploitation in the exchange contract. By exploiting this flaw, the hacker made the price of the MONO token increase.
In this way, the hacker – who owned the token – benefited from the artificial valuation. Then he applied the scam itself: he used the newly prized MONO to buy WETH and MATIC. Finally, they cashed those tokens and dropped the MONO value again.
In this move, the hacker managed to acquire US$ 18 million in WETH and about US$ 10 million in MATIC. Other tokens such as WBTC, GHST, DUCK, IMX, MIM and LINK were also acquired.
So far, MonoX hasn’t provided more details about the security breach. However, the protocol had already been warned about risks of manipulation on its platform.
In May 2021, Halborn performed a full audit of the DeFi protocol and released its results in a comprehensive report. As the document explained, Halborn recommended that MonoX introduce oracles to validate the price of tokens.
According to the company itself, the measure was suggested with a view to preventing malicious users from causing manipulation. MonoX even introduced a mechanism to control this, however it was not enough.
“When risks are encountered, it is up to the customer to mitigate or accept that risk. A risk identified by Halborn to MonoFinance (page 18) was exploited and funds stolen today (30).” explained the company.
Attacks on DeFi Protocols
This latest incident adds to the growing list of DeFi protocols victimized by attacks in 2021. The industry has grown exponentially in numbers and allocated value, but has become a major target for hackers.
The most recent attacks have caused thefts of US$12 million and US$5 million, targeting pNetwork and Avalanche platforms, respectively.
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