Celer Network

The Celer Network has warned its users to revoke contract approvals to their bridge, since they have suffered an exploit. So far, they estimate that $240k in ETH has been stolen.

Another bridge hack?

Bridge hacks have consistently been amongst some of the largest hacks in 2022.  The complexity involved in building bridges is high, and in most cases they are not optimised for security.

The Ronin bridge hack, the Poly Network bridge, and the Wormhole make up the three largest hacks in all of DeFi history ($624m, $611m and $326m respectively).

These hacks have been significant, because when a bridge is vulnerable it doesn’t only call into question the safety of bridges, but also the safety of the blockchains that depend on them.

For example, when the Solana Wormhole bridge was hacked, it could have been disastrous for the Solana ecosystem since it meant that suddenly all of the ETH on the Solana blockchain (that had been wrapped) was suddenly no longer backed.

This is also one of the largest risks for the Polygon blockchain: their bridge depends on a multi sig that, if compromised, could be disastrous: even if the MATIC remained untouched, the ecosystem would suffer if all WBTC and WETH  on Polygon were no longer backed by anything.

However, in this case, CelerNetwork did not suffer an exploit on their bridge itself. Rather, they suffered an attack on their front end that, if used, would mean that people were interacting with malicious smart contracts.

How common are these attacks?

These attacks are very common, and growing more common all the time. Unlike complex interoperability hacks such as that which crippled the Poly Network, front end hacks are quite simple.

Front ends are quintessentially just slightly more sophisticated phishing attacks, but the stakes are that you automatically lose all the money in your wallet if you sign the wrong transaction.

Of course, it isn’t always easy to tell how much is lost in these attacks, given that the addresses to which drained funds are send can be changed during the hack, and it isn’t always clear how many people would have therefore been exposed.

For example, one of DeFi’s most active users according to his Degen Score lost 500k USDC today in such an exploit, after signing a malicious contract.

Curve.Fi suffers a similar issue

Earlier this month, a very similar thing happened to Curve.Fi, one of the most important projects in the entire space of DeFi.

The reason that Curve is so important is because it is the main dApp for generating yield without impermanent loss. The growing importance of yield for the Ethereum and DeFi ecosystem has had Curve positioned at the centre of the “Curve Wars”, and has now accumulated $6bn in TVL.

In the case of Curve , $500k was stolen, before the issue was quickly rectified. It could have been a lot worse given how much is traded on the Curve platform each day, but fortunately it was another lucky escape for unwitting DeFi users.

CELR lists on Coinbase

However, the news isn’t all bad for CELR, who did deal with the problem remarkably quickly and saved a lot of user funds in the process. They decided to freeze the front end so that more funds would not be lost, and promised to reimburse all users who had lost funds thanks to the DNS attack.

Moreover, they have since relaunched their front end after patching the problem and have made sure to add additional monitoring as a preventative measure to ensure that nothing problematic happens again.

All of this comes with the news that CELR was just listed on Coinbase.

For many, exchange listings are moments of anticipation when speculation overprice is the most rife.  Nevertheless, it seems that in the case of Coinbase particularly, listings can be foreshadow doom in token price.

After all, Coinbase’s own listing when they launched their IPO signalled the top of the market in 2021.

Fortunately, over the long term, the competent and quick way that this issue was deal with by the team at Celer Network is a testament to the project and can actually be a positive thing for the project long term, given that they have now been tested and performed well.

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