The prominent decentralized finance (DeFi) platform Balancer has fallen victim to an exploit resulting in losses exceeding $128 million across several digital assets. Multiple blockchain security firms have confirmed the attack in real-time, with new details continuously emerging.
Details of the Exploit and Potential Cause
Blockchain security firm PeckShield reported that Balancer and its associated forks are currently under attack, with cumulative losses across various chains reaching approximately $128.64 million. Mikko Ohtamaa, CEO and co-founder of Trading Strategy, suggested that a faulty smart contract check is the likely cause of the breach.
Uttam Singh, an engineer at Alchemy, analyzed the damage on a chain-by-chain basis. He observed that there are at least 27 Balancer-like forks, according to DeFiLlama, indicating that the contagion effect might not have reached its peak. This uncertainty is further heightened by the fact that the exploiter's address remains active, continuously deploying new contracts, minting custom ERC-20 tokens, and conducting ongoing probes.
Balancer's Official Statement and Past Incidents
Balancer's only official statement regarding the incident reads:
We’re aware of a potential exploit impacting Balancer v2 pools. Our engineering and security teams are investigating with high priority. We’ll share verified updates and next steps as soon as we have more information.
This incident follows a previous security event in September 2023, where Balancer's front-end was targeted in a DNS attack. This attack was attributed to a social engineering breach at its domain registrar, EuroDNS. While the protocol did not confirm specific losses, on-chain investigator ZachXBT estimated that approximately $240,000 was stolen during that incident.
Suspicious Activity Post-Exploit
Amidst the ongoing chaos, the analytics platform Lookonchain flagged a whale wallet, identified as 0x0090. This wallet had been dormant for three years but became active shortly after the exploit was confirmed. The wallet then rapidly withdrew over $6.5 million from Balancer.