Cybersecurity firm PeckShield has announced that decentralized cryptocurrency exchange GMX has been the victim of price manipulation.
PeckShield removed their announcement shortly after, but other blockchain researchers confirmed the leak of around $565,000 worth of assets in the AVAX/USD pair. A little later, the GMX cryptocurrency exchange admitted the manipulation with the currency pair:
“We have been made aware of AVAX/USD price manipulation on the exchange by monitoring systems and community members. For now, just watch what happens. We have capped AVAX long perpetual futures at $2 million and AVAX short perpetual futures at $1 million.”
A week before the incident, a user with the nickname derpaderpederp
warned on Twitter that GMX may be facing a price manipulation exploit in Ether (ETH) transactions, as the exchange is vulnerable to such transactions.
The exploit can be used with any currency pair, as the DEX offers minimal spread and zero price impact, security experts say. The scammer used the exploit and profited by going long on both the DEX and centralized exchanges like Binance or FTX. Even more profit can be obtained from short positions with a smaller amount of assets.
The process is repeated, however, such actions deplete the token of the platform’s liquidity provider – GLP. At press time, DeFi exchange GMX has not released a detailed statement regarding the potential exploit. But it is known that the price of the GMX cryptocurrency has already fallen by 20%.
In July, Nirvana Finance’s DeFi project on the Solana blockchain was hit by an attacker who took out an instant loan in USDC worth $10 million to create ANA tokens worth the same amount.
Source: Bits
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