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Decentralized Exchange OpenLeverage Has Been Hacked

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Decentralized Exchange OpenLeverage Has Been Hacked

OpenLeverage, a DEX, was hacked, leading to a $236,000 loss, affecting operations on BNB Chain and Arbitrum. The platform will cover all protocol losses with its insurance and buyback funds but will shut down trading services. The DEX is setting up processes for users to withdraw funds safely, offering a bounty for the return of stolen funds.

In a security breach, blockchain forensics firm PeckShield revealed that OpenLeverage, a decentralized exchange (DEX), suffered a hack resulting in a loss of $236,000.

This cyber-attack has prompted OpenLeverage to pause its protocol as it embarks on a thorough investigation into the incident.

OpenLeverage Falls Victim to Crypto Hackers

OpenLeverage disclosed that the exploit predominantly affected its operations on BNB Chain and Arbitrum, with approximately $220,000 and $40,000 lost, respectively. However, the platform reassured its users that it would not compromise personal funds.

“The recent exploit caused a loss… [But] thankfully, our in-protocol insurance, OLE buyback fund, and protocol reserves will cover all protocol losses,” OpenLeverage announced.

Despite the financial safety net provided by the accumulated insurance and buyback funds, OpenLeverage has decided to shut down its trading and lending services.

The firm is currently setting up mechanisms for users to close their trades, borrowings, and withdraw funds safely. It will keep all protocol actions on hold until it initiates the withdrawal processes, which are expected to begin early next week.

Read more: Identifying & Exploring Risk on DeFi Lending Protocols

In addition to rectifying the current situation, OpenLeverage offers the hacker a bounty to return the stolen funds. It also announced that tracing and legal actions against the perpetrator will commence immediately.

This incident reflects the vulnerabilities faced by decentralized crypto exchanges and the importance of robust security measures and emergency protocols to safeguard user assets.

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