$4.4 Million of Binance Coin & WETH Exploited on Ethereum Sidechain

In the latest reports from the Meter team, the Ethereum sidechain witnessed an unexpected occurrence on a Saturday morning which led to a severe exploit on the Meter bridge.

Although the transactions were stopped immediately upon discovery, it was already too late.

The Exploit

As per the details revealed by the Meter team, someone managed to leverage an existing vulnerability of the bridge using which the exploiter was able to mint $4.4 million worth of Binance Coin (BNB) and Wrapped Ethereum (WETH) tokens. This resulted in the bridge reserves depleting.

Community, we really appreciate everyone’s patience and support as we work to get back up and running after this morning’s exploit.

We have detailed everything in the below thread:

— ⚡️Meter.io⚡️ (@Meter_IO) February 5, 2022

As soon as the team was alerted of the same transactions across the bridges were halted and within the next 30 minutes, the issue was identified. According to the Meter team:

“The issue (was identified) to be a bug introduced in the automatic wrap and wrap of native tokens like BNB and ETH extended by the Meter team. The extended code had a wrong trust assumption which allowed hacker to call the underlying ERC20 deposit function to fake an BNB or ETH transfer.”

The only networks that were actually affected by this exploit were Meter and Moonriver’s. The other remaining tokens and their reserves were declared SAFU by the team.

Furthermore, the Meter team stated that they were working on a compensation plan for the users affected by the exploit and urged all other liquidity providers for WETH and BNB to pull out their liquidity from the pools. 

The Moonriver network is actually the Kusama deployment of the Moonbeam project which won the third slot during the Parachain auctions raising well over $40 million.

Binance Coin and Ethereum

Surprisingly neither of the tokens were affected by the exploit as they were both following the broader market’s bullish cues. Within a span of 4 days, both Binance Coin and Ethereum managed to paint a rally of 18.11% and 17.83% respectively.

However, at the time of this report with Bitcoin struggling to close above $44k, both BNB and ETH too were trading in the red. Going forward, investors are hopeful for either slowed recovery or consolidation but not a price fall.