The Cream Finance cryptocurrency exchange has announced a security breach that resulted in a loss of $29 million. The company announced the hack on their website and Twitter account.
Cream Finance said that a hacker successfully stole 418,311,571 AMP tokens and 1,308.09 in ETH from its platform. The company also admitted that the attack was successful due to negligence in which they implemented a “reentrancy attack” in their “flash loan” feature.
Cream Finance utilizes the power of Etherium blockchain technology to provide quick loans to its customers. They have created a contract that runs on the Etherium blockchain, which allows their customers to take out loans from Cream Finance’s funds and then pay them back later.
A reentrancy attack is a type of application-level denial-of-service attack. It involves forcing an action to occur repeatedly in a loop without allowing the target time to recover. It involves an attacker who somehow manages to control the execution flow and can cause it to execute code repeatedly on some other thread. The attacker does this by modifying the object graph so that when the application reaches certain conditions (e.g., waiting for user input), it triggers some code that causes it to enter the loop again.
Crypto-hacking is becoming more common
Crypto hacks have been on the rise in the past few years. They have caused a lot of damage to companies and people without any legal repercussions.
Recent crypto hacks include the Coincheck hack, Bitgrail hack, and Bancor Network’s decentralized crypto exchange hack. These attacks have been on the rise as more people are turning to cryptocurrencies for investments. People are not exactly sure how to store their cryptocurrencies safely, which is leading to these attacks.
As crypto-assets grow in number, so does the need for security. With the increasing number of crypto hacks, it becomes essential for holders to secure their assets with proper encryption and other security measures.
Also Read: Digital Assets Are Nothing More Than Speculation, Says China’s Central Bank
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