OP's price takes a 4.5% hit after Optimism faces 'very high risk' security issues

OP’s price takes a 4.5% hit after Optimism faces ‘very high risk’ security issues

Last updated: 2024/04/27 at 8:45 PM

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The problem could have significantly jeopardized user funds
OP token dropped 4.57% in 24 hours after disclosure

L2s are in the news today after major security issues were discovered at Optimism’s [OP] stack, the software underlying top layer 2 (L2) chains such as the OP Mainnet and Base. Interestingly, the issues were brought to light by Offchain Labs, the original developer of another leading Ethereum scaling solution – Arbitrum [ARB].

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Optimism avoids major risks FUD is damaging Optimism’s OP token

Optimism avoids major risks

In a blog post shared on April 26, Offchain Labs highlighted the security flaws discovered in the recently released OP Stack fraud proofs in the test environment. The evidence related to these loopholes was shared with OP Labs, the development team behind Optimism, who later admitted to it.

The flaws allowed an attacker to tamper with the security of the chain, either by having a fraudulent claim accepted by the protocol or by having a correct claim rejected. These issues could have left user funds at “very high risk” if the version had reached the mainnet.

According to Offchain Labs, at the time of writing, OP Labs had resolved these issues, which also included updating the testnet.

For those unfamiliar with the project, OP Labs has been testing fault proofs for the past few months, a key security feature at the heart of the optimistic rollup technology. L2 chains built on the OP Stack are among the largest in the ecosystem, with Base, Blast and OP Mainnet accounting for more than 48% of total rollup deposits, AMBCrypto found using DeFiLlama data.

Source: DeFiLlama

Realistic or not, here is OP’s market cap in BTC terms

FUD is damaging Optimism’s OP token

Although the issue has been resolved, the disclosure generated significant FUD among OP token holders. According to CoinMarketCap, the crypto is down 4.57% in the past 24 hours.

Market sentiment for the coin also remained negative, as shown by AMBCrypto based on Santiment data. Moreover, the Open Interest (OI) in Futures market declined, indicating that interest from speculative traders is low.