A decentralized exchange (DEX) built on Osmosis (OSMO) was hacked this week for $1.14 million worth of crypto.
The Levana Protocol (LVN), which focuses on perpetual swaps, announced on Wednesday that it had been hit by an oracle attack that affected 10% of its liquidity pools (LPs).
Levana says the issue has been resolved and the opening positions will reopen next week. The project notes that existing liquidity pools are not at risk of further attacks and says affected LPs will be compensated through future airdrops and protocol fees collected during the hack.
The decentralized exchange notes that the exploit began on December 13.
“A suspected attacker was able to launch a congestion attack on the Osmosis chain to deny most Levana users the ability to interact with Levana markets for a predictable period of time, thereby denying them the ability to use the Pyth oracle contract to update. A bug in the Osmosis fees market code meant that during times of congestion, the gas price offered was generally insufficient to execute transactions or perform ongoing bot maintenance activities. This, combined with the price steeliness in Levana’s interaction with Pyth, led to the ability to perform an oracle attack and drain Levana’s pools by approximately 10% over a 13-day period.
Levana started issuing its own token, LVN, a month ago. LVN is trading at $0.183 at the time of writing and is down more than 34% in the last seven days.
Osmosis is an automated market maker (AMM) protocol built on the Cosmos (ATOM) software development kit (SDK). The goal is to enable cross-chain transactions using inter-blockchain communication (IBC).
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