Polygon quietly upgrades network to save $24B worth of MATIC from ‘critical’ bug

Polygon upgraded its network, but malicious elements still made away with over 801,000 MATIC tokens. Image from freepik
Polygon upgraded its network, but malicious elements still made away with over 801,000 MATIC tokens. Image from freepik

Key Takeaways:

  • Polygon silently upgraded its network after a critical security flaw put 9.3 billion MATIC tokens at risk.
  • MATIC prices fell after charting new ATH this week.

NEW DELHI (CoinChapter.com) — Ethereum Layer-2 solution Polygon undertook a hard fork earlier this month to save the project from a ‘critical vulnerability.’ Still, the network didn’t share any details about the issue until 24 days later, on Dec 29.

The exploit would have put 9.3 billion MATIC at risk, approximately worth $24 billion, out of its total supply of 10 billion MATIC tokens. Additionally, two whitehat hackers approached Immunefi about a possible vulnerability in the Polygon PoS Genesis contract. Immunefi hosts the Polygon network’s bug bounty program.

Polygon executed the upgrade on Dec 5 at Block #22156660 via an ‘Emergency Bor Upgrade for Mainnet,’ without impacting the network performance in any way. In addition, the L2 scaling platform noted that the upgrade did no ‘material harm‘ to the users or the protocol.

All projects that achieve any measure of success sooner or later find themselves in this situation. What’s important is that this was a test of our network’s resilience as well as our ability to act decisively under pressure. Considering how much was at stake, I believe our team has made the best decisions possible given the circumstances.

Polygon’s co-founder Jaynti Kanani said.

Before the mainnet upgrade, Polygon initially updated the Mumbai testnet. However, despite the network’s swift action, a malicious hacker got away with 801,601 MATIC tokens.

Also Read: MATIC prices react to Polygon’s “burning” news to recover from Monday’s 13% fall.

Polygon paid $2.2 million in stablecoin to one of the white hat hackers, Leon Spacewalker. A second white hat, identified only as white hat hacker 2, received 500,000 MATIC, worth just over $1.2 million. Polygon exceeded the maximum value of its critical bounty in recognition of the severity of the vulnerability.

Polygon Price Chart

MATIC price continues to move in its five-month-long ascending channel. The Polygon token fell over 20% since Dec 27.

The current downtrend might likely result from sell-triggered by MATIC reaching a new ATH of $3 on Dec 27. In addition, the Polygon token price faces resistance near the $2.5 mark. If prices catch some bullish tailwinds, the MATIC token could break above immediate resistance to challenge $2.7.

The relative strength index remains in neutral regions clocking 55.36 daily. The RSI trendline rebounded from the overbought boundary on Dec 26.

MATICUSD chart in the daily time frame with RSI. Source: Tradingview.com
MATICUSD chart in the daily time frame with RSI. Source: Tradingview.com

MATIC is bullish across all time horizons, evident from the token’s 50-day, 100-day, and 200-day MA lines. On the other hand, if prices continue to move downward, MATIC would seek support from its 26-day EMA line near $2.3. Further support for the Polygon token is near $2.2, which acted as a resistance between Oct 28 to Dec 21.

Recommended: Polygon (MATIC) price tumbles 7.5% after new ATH; what’s next?

Furthermore, MATIC’s 50-day MA line supports the token near $2.

Meanwhile, trend-based momentum oscillator MACD seems poised to chart a bearish crossover soon, as bars on the MACD histogram are almost near zero. The histogram plots the difference between the MACD line (difference of 12-day and 26-day EMA) and the MACD signal line (9-day EMA of MACD).

MATICUSD chart in the daily time frame with MACD. Source: Tradingview.com
MATICUSD chart in the daily time frame with MACD. Source: Tradingview.com

When the MACD line moves below its signal line, it creates a bearish crossover indicating the momentum for the token turned in favor of bears.

At the time of writing, MATIC was trading at $2.4, up 0.85% on the day.

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Polygon, Polygon quietly upgrades network to save $24B worth of MATIC from ‘critical’ bug

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