- The Jinbos Protocol Team said it had admitted to the hack and had contacted law enforcement.
- Blockchain security platform Pecshield noted that the attack followed a compromise of Jinbos’ liquidity conversion mechanism.
- The price of the underlying liquidity token, JIMBO, fell 40% as the market reacted to the hacking news.
The Arbitrum-based Jinbos protocol was hacked on the morning of May 28, resulting in the loss of over 4,000 Ether (ETH), worth about $7.5 million at the time.
As a result of the hack, the price of the underlying token, JIMBO, plummeted by 40%.
Another day, another hack
Malicious attacks in the cryptocurrency space continue to taint the growing industry, with attackers exploiting vulnerabilities to steal millions of dollars worth of assets from platforms and users. The most recent was an attack that exploited Jimbos’ liquidity conversion mechanism, stealing 4,090 of his ETH tokens.
The Jimbos protocol is a relatively new protocol, launched less than 20 days ago. The protocol aims to address liquidity and volatile token prices through a new testing approach. However, it appears that the vulnerability was exploited by hackers because the protocol’s mechanisms were not properly protected.
According to blockchain security and data firm Pecshield, hackers were able to cancel swap orders for their own benefit, resulting in a loss of funds.
company tweeted Evaluation after the unfortunate event:
“This hack stems from the lack of slippage control for liquidity shift operations. In other words, the liquidity owned by the protocol is invested in a skewed/unbalanced price range, which is then exploited in reverse swaps for profit.”
Jimbos Protocol Team announced The company said it was “aware” of the attack and has contacted law enforcement and blockchain security experts.
As reported here, earlier this month, attackers compromised the Tornado Cash protocol and stole 483,000 TORN tokens. They then transitioned to exchanging these tokens for ETH. Attackers managed the exploit by seizing control of the Tornado Cash governance system.
TORN’s price dropped 50% in response to the news.