KyberSwap commits to covering user losses from recent exploit KyberSwap commits to covering user losses from recent exploit

KyberSwap commits to covering user losses from recent exploit

KyberSwap has announced a grant program to alleviate losses from its $48 million liquidity pool hack.

KyberSwap commits to covering user losses from recent exploit

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KyberSwap announced on Dec. 1 that it will offer grants in order to compensate users affected by a recent exploit.

The decentralized exchange acknowledged that a recent attack drained $48.8 million of user funds from its elastic liquidity pools a feature that allows users to stake cryptocurrency in order to earn interest or generate yield.

KyberSwap explained:

“Our present plan is for the KyberSwap Treasury to extend a grant to each user (who lost funds in the exploit and which have not been recovered) of an amount up to the USD value of such funds at the time when such funds were drained from their respective liquidity pools.”

The platform said that this plan intends to “ease the hardship from the loss” and that it plans to announce more details over the next two weeks.

KyberSwap added that it is supporting law enforcement and cybersecurity teams in their efforts to identify and locate the attacker and recover any stolen funds. The platform mentioned its status as a decentralized and permissionless protocol, noting that users accept risks according to the terms of service.

Exploit took place in late November

KyberSwap was initially hacked on Nov. 22. The project responded on the same day by confirming the incident and urging users to withdraw their funds.

The hacker expressed a desire to negotiate shortly after the attack. In a surprising turn of events, the hacker demanded complete control of KyberSwap by publishing an on-chain message on Nov. 30. KyberSwap has not stated whether it is willing to negotiate with the hacker or provide a bounty for the return of funds.

KyberSwap is a decentralized exchange aggregator supporting 14 blockchains, including Ethereum. According to data from DefiLlama on Dec. 1, the platform had $7.17 million in total value locked (TVL).

The platform’s security has previously been called into question. KyberSwap’s front end was hacked in September 2022, leading to the loss of $265,000. Risks around the platform’s liquidity pools were identified months ago in April.

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Posted In: , DeFi, Hacks