The Impossible Finance Decentralized Finance (DeFi) protocol powered by the Binance Smart Chain has come under attack using instant loans. Hackers managed to withdraw 229.84 ETH.
As a result of the attack on the Impossible Finance liquidity pool, which took place on June 21 at around 4:40 UTC, the hackers withdrew 229.84 ETH worth about $ 500,000. Security specialists WatchPlug reported that the hackers exploited a vulnerability in the liquidity pool smart contract. This allowed for several transactions to exchange the internal Impossible Finance token for BUSD and then for BNB to repay the instant loan.
However, the oddity is that the swaps were executed one after the other at the same price, which is usually impossible to execute due to slippage. The developer of the SushiSwap decentralized exchange, Mudit Gupta, said the incident resembles the May attack on the BurgerSwap protocol, which also operates on the Binance Smart Chain. Then the attackers were able to withdraw cryptoassets worth about $ 7.2 million.
In the case of Impossible Finance, the hacker also began using a quick credit attack to drain the liquidity pool with fake tokens, manipulating the market in their favor. Impossible Finance said it would compensate users for any lost funds.
Currently, all Impossible Finance liquidity pool rewards are suspended and project users are advised not to deposit or withdraw funds for BUSD and BNB trading pairs. The project team said it is working with research firms PeckShield, WatchPlug and other security professionals to investigate the incident.
Note that the attack on Impossible Finance came less than three weeks after the protocol raised $ 7 million in a funding round involving True Ventures, CMS Holdings, Alameda Research and Hashed. Initially, the project started working on the basis of Binance Smart Chain, but in the future it is planned to switch to Ethereum and Polygon.
Lately, many projects have been the victims of instant borrowing attacks. One of them is PancakeBunny, which lost about $ 200 million worth of crypto assets. The Binance Smart Chain developers believe that these attacks can be interconnected, and suggested that projects create reserve funds to hedge against such situations.
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