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Decentralized Protocol OpenLeverage Suffers Multiple Hacks, Losing $230K: Report

Reports have surfaced indicating that OpenLeverage, a protocol for permissionless lending and margin trading, has been targeted in multiple hacks resulting in the depletion of assets valued at $230,000.

The breaches were identified by blockchain security firm Cyvers Alerts on Twitter. According to their announcement, the losses amount to approximately $230,000 in cryptocurrency, with the attacker’s wallet being funded through Tornado Cash.

“Our system detected the deployment of the malicious contract 13 seconds prior to the attack transactions,” the post stated. “The stolen funds remain in the attacker’s address.”

Tornado Cash, an OFAC-sanctioned cryptocurrency mixing protocol, has allegedly been utilized by North Korea’s Lazarus Group to launder over $100 million obtained through cryptocurrency theft.

Following the incident, OpenLeverage has confirmed the suspension of its operations while investigations are conducted.

“We believe that the accumulated insurance and buyback funds will be sufficient to cover the losses,” the statement assured.

In a further update, the company has confirmed losses of $220,000 on the BNB Chain and $40,000 on Arbitrum.

Fortunately, OpenLeverage assures users that all losses incurred by the protocol will be covered by their in-protocol insurance, OLE buyback fund, and protocol reserves, ensuring that no user funds will be affected.

As a response to the hacks, OpenLeverage has made the decision to halt its trading and lending protocol and has begun the process for users to withdraw their funds.

“All protocol activities will remain suspended until withdrawal procedures commence, expected to begin early next week,” a recent statement explained.

Furthermore, the protocol has announced a bounty for the hacker in exchange for the return of the stolen funds, although the specific reward amount has not been disclosed.

“The hacker will be offered a bounty for returning the funds, and the tracing and legal proceedings will commence immediately.”

OpenLeverage had previously received investment from Binance Labs in June 2022, although the exact amount of funding remains undisclosed.

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