In a recent incident in the world of decentralized finance (DeFi), KyberSwap Elastic, a decentralized exchange (DEX) under Kyber Network, fell victim to a security breach, resulting in the loss of approximately $46 million in various cryptocurrencies. The Kyber Network team acted swiftly, notifying users through a Twitter post and advising them to withdraw their funds as a precautionary measure. They also assured users that an investigation was underway. The attacker managed to move the stolen funds across multiple chains, including Arbitrum, Optimism, Ethereum, Polygon, and Base. The assets that were drained included $20 million in Wrapped Ether (wETH), $7 million in wrapped Lido-staked Ether (wstETH), and $4 million in Arbitrum (ARB). As a result of the attack and subsequent user withdrawals, KyberSwap’s total value locked (TVL) experienced a significant drop of 68%, with approximately $78 million leaving the protocol. Currently, KyberSwap’s TVL stands at $27 million, down from its peak of $134 million in 2023. On-chain analysts dismissed the possibility of the attack being related to a bug in the DEX’s approval authorization code and instead suggested that it was a targeted attack against the liquidity provider pools themselves. The attacker even left a message on-chain, hinting at negotiations with protocol developers and DAO members. This incident follows a trend in DeFi exploits where attackers use signed transactions to communicate messages. The Kyber Network Crystal (KNC) token experienced a temporary 7% dip in prices when news of the exploit broke but has since recovered. It is worth noting that Kyber Network had previously identified a potential vulnerability in its exchange contracts in April, but no funds were lost in that particular incident.

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Information	Details
Geography	Global
Countries
Sentiment	negative
Relevance Score	1
People	None
Companies	Ethereum, KyberSwap Elastic, Polygon, Optimism, Arbitrum, Base, Kyber Network, DEX, Debank
Currencies	Arbitrum, Kyber Network Crystal, Aave v3 WETH, Bridged Wrapped stETH
Securities	None