Ankr buys $5M BNB to compensate for exploit

Decentralized finance BNB chain protocol Ankr, suffering from a massive exploit earlier this Friday, decided to compensate the liquidity providers by acquiring $5M worth of BNB.

The attack was discovered by PeckShield, an on-chain security analyst, citing it happened due to a bug in Ankr protocol that allowed the hacker to endlessly mint aBNBc tokens. The exploiter then used services such as PancakeSwap, Uniswap, Tornado Cash, and various bridges to exchange and conceal funds to get around $5M of USDT.

The Ankr protocol reacted swiftly on Twitter. The team assured users of the protocol’s safety, further revealing the decision to compensate for the exploit:

We will take a snapshot and reissue ankrBNB to all valid aBNBc holders before the exploit.

Additionally, Ankr will purchase 5m worth of BNB and use this to compensate in totality the liquidity providers that have been affected by the exploit due to the drainage of the liquidity pool.

According to CoinGecko data, as the hacker almost completely emptied the aBNBc liquidity pools on PancakeSwap and ApeSwap, the token lost 99.5% of its value.

Related: Crypto Digest From TradeCrypto.com #182

Ankr protocol continues to work with exchanges to halt trading. Binance tweeted:

Later that day, Binance CEO Changpeng Zhao added:

Possible hacks on Ankr and Hay. Initial analysis is developer private key was hacked, and the hacker updated the smart contract to a more malicious one. Binance paused withdrawals a few hrs ago. Also froze about $3m that hackers move to our CEX.

Furthermore, another hacker took advantage of Ankr’s situation and exploited Helio Protocol, which hasn’t updated the new pricing for aBNBc.The trader could use the prices that existed before the aBNBc collapse to borrow $16M of HAY stablecoin and convert it to 15.5M BUSD.