Decentralized Exchange Built on Osmosis Hit With Oracle Attack, Hacked for $1,140,000 Worth of Crypto – The Daily Hodl

A decentralized exchange (DEX) built on Osmosis (OSMO) was hacked for $1.14 million worth of crypto this week.

The Levana Protocol (LVN), which focuses on perpetual swaps, announced on Wednesday that it had been hit with an oracle attack that impacted 10% of its liquidity pools (LPs).

Levana says the issue has been resolved and opening positions will relaunch next week. The project notes existing liquidity pools are not at risk of further attack and says impacted LPs will be compensated via future airdrops and protocol fees that were collected during the hack.

The decentralized exchange notes the exploit began on December 13th.

“A presumed attacker was able to launch a congestion attack on the Osmosis chain to deny most Levana users the ability to interact with Levana markets for a predictable period of time, and thereby deny them the ability to update the Pyth oracle contract. A bug in the Osmosis fee market code meant that during times of congestion, the provided gas price was generally insufficient for making trades or performing ongoing bot maintenance activities. This, coupled with price staleness in Levana’s interaction with Pyth, led to the ability to perform an oracle attack and drain Levana pools roughly 10% over a 13-day period.”

Levana began issuing its native token, LVN, a month ago. LVN is trading at $0.183 at time of writing and is down more than 34% in the past seven days.

Osmosis is an automated market maker (AMM) protocol built on the Cosmos (ATOM) software development kit (SDK). It aims to enable cross-chain transactions by utilizing inter-blockchain communication (IBC).

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• Source: https://dailyhodl.com/2023/12/29/decentralized-exchange-built-on-osmosis-hit-with-oracle-attack-hacked-for-1140000-worth-of-crypto/