Ankr says no one should trade aBNBc, only LPs that are “surprised” will be compensated

Following the multi-million dollar exploit confirmed yesterday, the BNB chain-based protocol Ankr took to its corporate blog on December 2 to let users know its next steps.

The team said it is identifying liquidity providers for decentralized exchanges, as well as protocols that support aBNBc or aBNBb LP. The group also said it rates aBNBc collateral pools like Midas and Helio. According to the post, Ankr intends to buy $5 million worth of BNB, which it will use to compensate liquidity providers affected by the exploit.

Some users speculatively traded diluted aBNBc after the exploit occurred, but the company stated that these traders will not be included in the protocol’s compensatory measures, stating “We can only compensate LPs who were caught off guard by the event.”

Update on our aBNB token exploit:

We are grateful to our community of DEXs, exchanges, and protocols who all helped us end the exploit quickly.

We will use reserves to compensate liquidity providers for the aBNBc pools.https://t.co/B2yNWBAQdX

— Ankr (@ankr) December 2, 2022

The developers briefly explained how the hack came about. A malicious actor gained access to the team’s “deployment key,” or the key originally used to deploy the protocol’s smart contracts. Since the contracts are updatable, this allowed the attacker to deploy an entirely new version of one of the contracts, giving them the ability to mint an unlimited number of coins “without authorization checks”.

After gaining this power, the team said the attacker minted 60 trillion aBNBb tokens “out of thin air.” These were swapped for USDC and moved out of the network via bridges to Ethereum.

In response, the team first transferred ownership of the contracts to a new, uncompromised account. This secured the contracts and prevented the attacker from doing further damage. Ankr’s validation, RPC API, and app chain services were not compromised, so transferring ownership of the contracts was the only action required to restore security.

Next, Ankr alerted all DEXs not to allow trading on aBNBc or aBNBb and is currently going through the process of identifying liquidity providers for these tokens, such as: B. those who deliver the token to Helios and Midas.

The blog post emphasized that the current versions of aBNBc and aBNBb will no longer be redeemable for BNB. A snapshot of the balances users had prior to the exploit is created. New versions of these tokens will be issued and token holders will be compensated with the new coins based on the balance they had prior to the exploit. Because of this, the team warned users against trading with aBNBc or aBNBb.

Ankr also mentioned that it recognized that some users engaged in arbitrage to profit from the exploit, but this arbitrage is not rewarded since the snapshot for the time and date of December 02, 2022 00:43: 18:00 UTC. Any trades made after this time will not affect the holder’s refund.

Additionally, the developers indicated that liquidity providers should remove their aBNBc and aBNBb tokens from their liquidity pools and instead keep the tokens in their wallets.

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