The decentralized financial lending protocol bZx came under attack last night, losing just over $8 million due to a software bug in smart contracts.

The flawed code allowed the attacker to copy the cryptocurrency, increasing his stock of iTokens powered by the bZx protocol.

Hours after noticing the bug, bZx paused minting and burning iTokens until the bug was fixed.

But the bug allowed the attacker to mint 219,200 LINK coins (worth about $2.6 million), 4503 Ethereum (worth about $1.6 million), 1,756,351 USDT (worth about $1.7 million), and 1,412,048 USDC (worth about $1.4 million). and 667,989 DAI (about $680,000).

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Meaning the theft overall amounted to about $8.1 million in total.

The bZx project management has told that users’ funds are not at risk as the loss is covered through bZx’s insurance fund.

Mark Tallin told a lead blockchain engineer that he initially identified the error.

He said more than $20 million in bZx funds are at risk.

Tallinn himself tried to exploit the loophole and created a loan using USDC ($100), after which he stated:

From this I got the iUSDC back, then sent it to myself to replicate the funds.

Then I placed an order for $200.

Kyle Kestner, co-founder of the bZx Project, said: to source By saying:

It’s hard to say how this serious bug was not recognized by the protocol auditing companies Peckshield and Certik.

A Peckshield spokesperson commented:

A single audit cannot guarantee that all potential issues will be found.

While I told Certik:

Trip security.

Some industry experts want bZx to stop operations and re-audit its protocol, but Kestner told me:

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bZx’s auditors did not recommend such a procedure.

The latest attack on the bZx project is the third attack on the bZx project this year, as in February, the protocol lost about $ 945,000 in two consecutive attacks.

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The latest attack led to a drastic 70% drop in the total value of bZx locked (TVL) to just about $6.3 million.

Kestner commented about the decline in the value of bZx coin telling:

Things are changing very quickly in this space (decentralized finance) in reference to the potential upside.

When Kestner was asked how bZx plans to boost users’ trust amid successive attacks, he said:

We want to create very attractive products, structures and incentives so that users basically have to use us regardless of how they feel about our brand.

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