KyberSwap, a crosschain DEX aggregator, has reported a security breach on KyberSwap Elastic – a platform that allows liquidity providers to set preferred price ranges and access auto-compounding yields.
According to Debank data, the exploit resulted in a loss of approximately $46 million in various crypto assets. The affected funds include roughly $20 million in Wrapped Ether (wETH), $7 million in wrapped Lido-staked Ether (wstETH), and $4 million in Arbitrum (ARB).
DefiLlama data reveals a significant decline in KyberSwap’s total value locked (TVL) by 68% within a few hours of the incident, with TVL standing at $27 million. Additionally, approximately $78 million left the protocol due to the hack and user withdrawals.
In response to the incident, KyberSwap advises users to withdraw their assets promptly as a precautionary measure. Furthermore, KyberSwap assures users that its aggregator is unaffected by the exploit and continues to operate normally. Nevertheless, the team has launched an investigation into the incident.
Afterward, an X user named Felix Thomas, who identified as a KyberSwap security researcher, posted a guide on how affected users could revoke approvals and check their eligibility for compensation. The process involved submitting an application on KyberSwap to revoke approvals and simultaneously checking for compensation eligibility.
Although the incident was initially presented as an approval-related issue, sleuth Spreek believes it may be different. In an X post, they expressed confidence that this is not an approval-related problem but rather linked to the total value locked (TVL) in the Kyber pools themselves.
Furthermore, the attacker left a note stating, “Negotiations will start in a few hours when I am fully rested.”
To ensure safety, it is advised to refrain from clicking on any phishing links or responding to direct messages. KyberSwap has specifically instructed users to only follow updates on its official social media and website pages.
KyberSwap experienced a security breach in September of last year that exploited its frontend, resulting in the theft of $265k from users’ funds. However, at the time, KyberSwap assured users that they had neutralized the malicious element and would compensate the affected addresses. In April, the DEX also alerted users of a potential exploit, but no losses were reported.
In light of this situation, some KyberSwap users expressed dissatisfaction with a second attack and concerns about whether they were affected. On the other hand, others mentioned their support for the platform during this challenging time.
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