DeFi

Cross-chain DeFi project pNetwork Hacked; $12.7M worth of Bitcoin (BTC) lost

Key Takeawasy

Hackers targetted cross-chain Decentralized Finance protocol pNetwork
The network lost $1.27 million in Bitcoin (BTC) on the Binance Smart Chain
pNetwork offers to reward the hackers $1.5 million if they agree to return the rest

YEREVAN (CoinChapter.com) — Hackers on Monday attacked Cross-chain decentralized finance (DeFi) platform pNetwork, according to its official Twitter handle.

According to pNetwork, the hackers stole 277 Bitcoins (BTC) in the heist. At the time of writing, the total value of the stolen BTC amounted to $12.7 million.

Hackers target pBTC on the Binance Smart Chain

Based on the information provided by the DeFi site, hackers spotted a code vulnerability in the codebase and attacked pBTC on the Binance Smart Chain (BCS). BSC is an Ethereum-compatible blockchain.

A pBTC is an ERC-20 token representation of Bitcoin (BTC). It is pegged 1:1, so its value is intrinsically linked to that of Bitcoin. In addition, it makes BTC compatible with the Ethereum blockchain.

ERC-20 tokens are blockchain-based assets that have value and can be sent and received. They are just like other in-house tokens issued by different blockchains. However, instead of running on their blockchain, ERC-20 tokens are issued on the Ethereum network.

The network also reported that the amount stolen in pBTC represented the majority of the network’s collateral. Making it clear that hackers compromised pBTC on the BSC only, the network assured that other bridges were not affected.

“All other funds in the pNetwork are safe,”
the DeFi site tweeted.

The DeFi platform offers to cut a deal with the hacker

The DeFi platform offered to cut a deal with the attackers to persuade them to return the stolen amount.

pNetwork generously agreed to let the hacker keep $1.5 million should they agree to return the rest of the stolen amount. The DeFi team called it a bounty for finding vulnerabilities in their network. As a result, for the continued growth of the DeFi ecosystem, pNetwork counted on the hacker’s cooperation.

“To the black hat hacker. Although this is a long shot, we’re offering a clean $1,500,000 bounty if funds are returned.”

The offer to let the hacker keep $1,500,000 as the bounty is not surprising. Back in July, THORChain, a decentralized liquidity platform, had also agreed to let the hacker keep 10% of the loot upon returning the $8 million in stolen funds.

In a subsequent tweet, the pNetwork team also apologized to pToken users and assured them that they “have a proposed fix and we are now waiting for everyone to review it.”

The price of pNetwork’s token PNT has been down 17% in the past 24 hours due to the hack.

PNTUSDT on TradingView

DeFi and Binance hacks

Of late, both the Decentralized Finance (DeFi) industry and the Binance Smart Chain (BSC) have become targets of regular hack attacks.

Last week, Decentralized Exchange NowSwap lost more than $1 million in 535,706 USDT and 158.28 WETH to hackers.

DeFi lending protocol Cream Finance lost $18.8 million in assets to a flash loan attack at the end of August. That was the second time hackers had targetted the protocol this year.

The cross-chain Defi protocol PolyNetwork also became the victim of the largest Defi attack, losing over $oo million in the process. The attack happened on August 10.

Projects on the Binance Smart Chain have also suffered similar attacks.

BurgerSwap, Pancake Bunny, and Belt Finance have all been victims of hack-attacks.

In 2021, other projects such as Cream Finance, Bogged Finance, Uranium Finance, SafeMoon, and Spartan Protocol have also suffered attacks on Binance Smart Chain.

With Binance Smart Chain claiming to be Ethereum’s main competitor in DeFi, hacks such as this one are tarnishing its reputation.