LaunchZone, a decentralized finance (DeFi) protocol built on the BNB Chain, suffered a major setback on February 27th when an unknown attacker drained over $700,000 worth of funds from its liquidity pool.
The BNB Chain project’s official Telegram group alerted users to the attack and advised them not to buy tokens until more information was available. The hack caused panic among the project’s 44,000 Telegram channel members and 275,000 Twitter followers.
The value of LaunchZone’s native token, LZ, plummeted as the funds were drained through PancakeSwap, according to blockchain data. LZ experienced an 85% drop in price within 24 hours, falling from $0.1525 to $0.002285.
However, the token has since rebounded and is currently trading at $0.02633. Despite the price drop, the trading volume of LZ surged by 2151.62% in the same period.
LaunchZone has not yet issued any official statements regarding the attack or provided details on how the attacker was able to exploit the protocol.
The project’s Facebook page has also not responded to requests for comment. Investors are advised to exercise caution and await further updates from LaunchZone’s team before making any investment decisions.
The attack on LaunchZone is the latest in a series of security breaches to hit the BNB Chain ecosystem. In October 2022, the BNB Chain fell victim to a $100 million exploit that led to a hard fork.
In February 2023, Jump Crypto, a web3 infrastructure firm, disclosed a critical vulnerability to the Binance Smart Chain team that could have allowed attackers to mint an unlimited number of tokens via malicious transfers. The Binance Smart Chain team was able to patch the vulnerability before it became public.
BNB Beacon Chain Vulnerability Discovered by Jump Crypto
Jump Crypto, a Web3 infrastructure firm, has reported discovering a vulnerability in the BNB Beacon Chain that could have resulted in the unlimited minting of arbitrary tokens. The flaw was disclosed to the BNB team privately, and a patch was created and deployed within 24 hours of the discovery.
Jump Crypto shared a detailed report last week about the vulnerability found two days earlier, which could have caused significant financial losses. The BNB Chain comprises two blockchains, with the Beacon Chain using a BNB fork that deviates from the Cosmos SDK upstream in several ways, according to Jump Crypto.
The vulnerability would have enabled attackers to mint an unlimited amount of BNB tokens via a malicious transfer. But the issue has been resolved by implementing overflow-resistant arithmetic methods for the SDK coin type.