Cypher Protocol Freezes Smart Contract Following $1M Exploit

Solana-based decentralized exchange Cypher Protocol has frozen its smart contract after suffering a security breach that allowed hackers to drain approximately $1 million worth of users’ crypto assets from the platforms.

Cypher Investigating the Exploit 

In a Monday tweet, the platform informed its over 13,500 followers of the incident, saying that its team is currently working with individuals to look into the matter. The decentralized exchange noted that it has also contacted the hackers to negotiate the possible return of the stolen funds.

“To the hacker: We are writing to see whether you would be open to speaking with us about any potential next steps,” Cypher tweeted.

While details of how the exploit was carried out remain scarce at the time of writing, data from Solscan shows that the wallet suspected to be linked to the attack stole 39,704 Solana tokens (SOL) and 123,231 USD Coin (USDC), totaling approximately $1 million in current prices. Shortly after the exploit, the suspected wallet moved 30,000 USDC to Binance’s Solana USDC address to withdraw the ill-gotten proceeds.

Crypto Community Reacts 

Members of the crypto community reacted to the incident, with many sending a series of non-fungible tokens (NFTs) to the alleged wallet. These NFTs aren’t just typical assets but come with messages requesting the attackers to return the stolen funds. 

One of the NFT messages reads:

“Seriously though, you used Binance and KuCoin to fund and to try and get 30k out. People will find you. Please do the right thing and give the rest back.”

On Monday, Cypher published another fresh tweet, calling on the attacker to reach out to the protocol via email or session chat app. This move could be an attempt to negotiate a potential bug bounty.

Meanwhile, the latest exploit further highlights the security challenges decentralized finance (DeFi) protocols face in recent times. Less than a month ago, Arbitrum-based DeFi protocol Rodeo Finance was exploited, with attackers stealing roughly $900,000 from the platform.