Synthetix Asset Issuance Platform Lose 37 Million sETH to Hackers
Synthetix, an Ethereum-powered synthetic asset issuance platform that claims to provide on-chain exposure to real-world assets like currencies, commodities, stocks and more, has suffered a massive oracle attack that has resulted in a loss of 37 million synthetic ether (sETH) tokens, according to The Block on June 24, 2019.
Per sources close to the matter, bad actors have successfully broken into the Oracle system of Synthetix, carting away 37 million synthetic ether (sETH) tokens. At the time of filing this report, the exact USD value of the stolen digital asset is yet to be ascertained.
Commenting on the ugly incident, Kain Warwick, CEO and Co-Founder of Synthetix reportedly stated that the team noticed that there has been a significant discrepancy in the sKRW price feed as a result of the security breach and the team has launched an investigation into the matter.
“There has been an incident with the price feed of sKRW, we are investigating the exact 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.”
Arbitrage Bot Launched Attack
The CEO also hinted that he believes the attack may have been orchestrated by a malfunctioning arbitrage bot and the owner of the software has been asked to immediately contact the Synthetix team to get the issue resolved. A bug bounty of an undisclosed amount has also been offered to incentivize the developers.
The Synthetix team says it has now disabled all internal assets transfers, in a bid to prevent further damage to the system.
Founded in 2017, Synthetix has started gaining significant traction in the cryptoassets ecosystem. Synthetix is designed to function as a multi-tier asset issuance platform, making it easy for users to mint nearly all types of assets including fiat, cryptos, and derivatives.
So far, the Synthetix platform has organized two funding rounds. It reportedly raised $250k in seed funding from Synapse Capital in September 2017, before conducting a hugely successful initial coin offering (ICO) that generated $30 million earlier in March 2018.
As reported by BTCManager in February 2019, Synthetix announced the launch of a first-of-its-kind synthetic Bitcoin (sBTC) on the Ethereum smart contracts blockchain, to give ether (ETH) users non-custodial exposure to bitcoin (BTC)