Credit: Original article published by CryptoPotato.

Spartan Protocol, a DeFi project on Binance Smart Chain, was exploited for over $30.5m. The hacker’s whereabouts are unknown, and a second version of Spartan Protocol is currently being rebuilt with implemented bug fixes.

What is/was Spartan Protocol?

Spartan Protocol provided a platform for incentivized liquidity and synthetic assets. The SPARTA token had an internal pricing mechanism without having to rely on external oracles for price settlement. Such a system could provide a fundamental basis for a trustless network of swaps, synthetic tokens, lending, derivatives, and more – at least in theory and according to the team.

Spartan Protocol claims to have ‘no investors, no team tokens, and no treasury,’ stating that the team’s personal funds were backstopping liquidity in the protocol and that those funds were stolen as well. They are currently working on rebuilding from the ground up, claiming that they will ‘rebuild the shield wall’ free of bugs or exploitable code.

How Did the Exploit Occur?

This thread on Twitter explains exactly how the exploit occurred in detail. A bug in Spartan Protocol’s code used current balances instead of cached balances (like Uniswap does) in order to calculate the value of LP tokens. This allowed an LP token to break up into more composite tokens than is correct since the pricing received by the protocol was incorrect.

Similar flash loan attacks have been seen in the past, like the Uranium Finance hack, where $50m was lost. In the Spartan Protocol incident, over $30.5 million was stolen, including about $19 million in BNB.

Hacks of this magnitude are a good reminder that code is only as safe as the coder who wrote it, and the cryptocurrency space as a whole is still nascent. Anything promising obscene returns always has an underlying risk, and investors should always keep this in mind.

According to Spartan Protocol’s Twitter, a cryptocurrency security & audit company, CertiK, audited their code in September of 2020. This same code is the one currently deployed, thus it excluded the exploit.

This article is strictly for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. CryptosOnline.com does not provide investment, tax, legal, business or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any loss or damage caused or alleged to be caused by, or in connection with, the use of or reliance on any content, goods, services or opinions mentioned in this article.

#Bitcoin #Crypto #Cryptocurrency

Categories:

Tags:

Comments are closed

Translate

Our Other Projects

EdgyBranding.com - Premium Domain Names.

Notezi.com - Social Network

ParisArtwork.org - Mid-century Paris NFTs, tokenized on the WAX blockchain.

NewYorkArtwork.org - Mid-century New York NFTs, tokenized on the Ethereum blockchain and offered on Rarible.

Dexize.com - Ultra-Priviate DEX.

ClassicAutomobile.org - Classic Automobile News.