Balancer Under Attack Again, Loses $238K

In yet another setback for the decentralized finance (DeFi) ecosystem, the Balancer protocol has fallen victim to a security breach, losing a staggering $238,000 worth of crypto assets. This incident marks the second attack on the popular DeFi liquidity protocol in as many months.

Frontend Attack Unveiled

On September 20, Balancer alerted its users about a suspicious attack on its frontend. Users were immediately cautioned not to interact with the Balancer user interface until further notice. While the investigation was underway, blockchain security firm PeckShield confirmed the theft, shedding light on the extent of the breach.

The attacker managed to siphon $238,000 in crypto assets from Balancer. Crypto enthusiast ZachXBT corroborated this fact by sharing an image and the attacker’s address. Subsequent investigations revealed that the attacker swapped 15.4 ETH for approximately 2,730 AVAX tokens, which were then transferred to the Mexc exchange.

DNS Hijacking Suspected

Industry commentator Colin Wu hinted at a potential DNS hijacking attack, although official confirmation of this theory remains pending. Visitors to the balancer.fi website were greeted with a red flag if they had the MetaMask extension installed, as it warned of potential deceptive activities that could trick users into dangerous actions.

Web3 analyst “cyclop” reported that the Balancer website had been injected with “Drainer,” a malicious program capable of deducting tokens from users’ wallets. They urged users to disconnect all wallets as a precaution. However, Balancer had yet to release an official statement regarding the situation, leaving users anxious about the protocol’s security.

While the attack briefly sent BAL token prices tumbling from $3.45 to $3.27, the full fallout remains uncertain. Remarkably, the protocol’s total value locked, standing at $710 million, remained unaffected, according to DeFiLlama.

This incident raises concerns about the security of DeFi protocols and underscores the need for continuous vigilance in the rapidly evolving cryptocurrency space. Balancer faces the challenge of restoring user confidence and shoring up its defenses against future attacks.