Token infrastructure platform Hedgey Finance loses $44.5 million in digital assets in two-hour attack on Ethereum and Binance Smart Chain

Token infrastructure platform Hedgey Finance suffered a devastating loss of approximately $44.5 million in digital assets within just two hours, highlighting the vulnerability of decentralized finance platforms to malicious attacks. The attack, which took place across Ethereum’s layer-2 network Arbitrum and Binance Smart Chain, was orchestrated by a malicious actor who exploited a flaw in Hedgey’s system.

According to a statement from blockchain security firm Cyvers, the attacker used flash-loaned funds to exploit Hedgey’s “createLockedCampaign” function, allowing them to steal $1.9 million initially before later siphoning off an additional $42.8 million on the Arbitrum chain. Despite Cyvers’ detection of the attack, attempts to reach Hedgey Finance’s team were unsuccessful, underscoring the need for greater collaboration between dApps and security firms to prevent such incidents in the future.

Following the attack, the suspicious address involved in the theft emerged as the primary holder of the BONUS token, the native digital asset of BonusBlock. The incident caused the value of the BONUS token to drop by around 10% to $0.5084, with the attacker already moving stolen assets to the Bybit exchange.

In response to the exploit, Hedgey Finance announced an ongoing investigation into the attack and advised users with active claims to cancel them using the platform’s website. The firm reassured users that they are working diligently to understand the attack and prevent any further breaches.

Meanwhile, fraudulent accounts posing as the Hedgey protocol have surfaced on social media, attempting to deceive hacked platform users into providing sensitive information through phishing links. This serves as a reminder of the importance of remaining vigilant and cautious in the face of such attacks within the cryptocurrency space.