Osmosis Exploited for $5 Million Worth of OSMO Tokens

Osmosis Exploited for $5 Million Worth of OSMO Tokens

09.06.2022 09:17
by Maksym Prykhodko
1 min read

Osmosis, a decentralized exchange created by using CosmosSDK, was drained for some $5 million. The exploit was made possible because of a critical bug in Osmosis’ system.

The $5 million worth of OSMO tokens was procured from Osmosis’ liquidity pools. While the liquidity pools were not completely drained, Osmosis has halted the blockchain until this bug is fixed.

The bug allowed users to withdraw 50% more than what they’ve deposited, in the process of providing liquidity to Osmosis’ liquidity pools. This was possible to do without a bonding period whatsoever, meaning there was no period over which the funds were locked.

One user exploited this bug more than 30 times, with numerous accounts. They decided to stop exploiting the bug once they’ve collected the $5 million.

The OSMO token is now down 6.58%. It trades at $1.07. According to CoinMarketApp, the token reached its all-time high value in March 2022, when it traded at $11.21, meaning that it is now 90% cheaper.

Author

  • Maksym has denied the existence of crypto as an asset for 3 years when he was working with standard financial instruments. Became Head of Treasury. Won the best bank employee award and left the bank for cryptocurrency exchange the next day. Got a second university degree, but that didn’t stop him from studying finance yet. Combines fiat and crypto experience to be as objective as possible in general matters. His dream is to be interviewed by Bloomberg.

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