Saddle Finance, a decentralized finance protocol, has suffered a $10 million hack, according to blockchain security and data analytics company PeckShield.
The exploit occurred in a group of transactions and took advantage of the wrong MetaSwapUtils library used to calculate the swap. The hacker launched the exploit with 1 ETH withdrawn from Tornado Cash.
Out of the 3932.76 ETH stolen, the hacker has sent about 900 ETH into Tornado Cash. As of press time, there are around 2500ETH in the wallet.
BlockSec helped Saddle Finance recover funds
According to the available information, Saddle Finance could have lost more if the smart contract auditing and blockchain security company, BlockSec, had not noticed the exploit. Using an internal system that uses flashbots to detect and prevent hacking incidents, the company recouped $3.8 million.
BlockSec had initially notified Saddle Finance about the hack on Twitter. The firm later revealed that
“The project was taken for around 4,900 ether ($13.8 million). Among them, 1,360 ethers ($3.8 million) were saved by us.
Saddle Finance has since confirmed the incident on its Twitter handle. The decentralized automated market maker stated that it is investigating the exploit and has paused metapool withdrawals.
According to the team, “single asset withdrawals are currently limited, but balanced pool withdrawals are still possible.” The DEX also confirmed that it was in contact with BlockSec to recover the $3.8 million.
While there are talks about how BlockSec was able to recover part of the funds, the bigger concern is the prevalence of theft in the crypto sector.
Crypto theft has taken various forms since the start of the year, with hackers using exploits and phishing to steal millions from platforms and directly from consumers. It is difficult to determine the effect of this large-scale theft on the growth of the sector, but it is not positive.
Just yesterday, we reported that Rari Capital and Fei protocols have lost around $90 million to exploits. With about $1.3 billion lost in the first quarter of this year, the rate of these thefts could lead to the loss of more than what was recorded in the space last year.
