BURGERSWAP

DESCRIPTION OF EVENTS

"BurgerSwap is the very first Uniswap-like application launching on Binance Smart Chain. The exchange was launched on September 10th at 16:00 PM UTC." "The BurgerSwap exchange was built from the ground up, with 14 contracts deployed and significantly more code than any competitor in the space, while not having copied a single line of code for Uniswap and comparable protocols."

"BurgerSwap [was] created for the community and its growth will be highly dependent on the community, by default." "BurgerSwap emphasizes the concept of a “democratized decentralized exchange”, which mean that governance is not optional but mandatory. The users make the rules!"

"At around 3 am on May 28th (UTC+8) BurgerSwap encountered a flash loan attack." "Burger Swap suffered a flash loan assisted reentrancy attack, resulting in over $7M worth of assets lost. The attacker was able to swap twice before the number of tokens in the reserve got updated."

"Hackers created their own Fake Coin (non-standard BEP-20 tokens) and formed a new trading pair with $BURGER; by adjusting the routing, attacker created $BURGER -> Fake Coin -> $WBNB routing; through $BURGER -> Fake Coin trading pair, attacker re-entered BurgerSwap through Fake Coin & manipulated number of reserve0 and reserve1 in the pair’s contract, causing the price to change; Then re-enter the transaction again and trade back the $WBNB, to obtain the extra amount of WBNB inputted."

"The exploit led to the theft of some $7.2 million in altcoins, including $3.2 million in BURGER, $1.6 million in wrapped binance coin (WBNB) and $1.4 million in tether (USDT, +0.12%)." "In its Twitter account, the project revealed the cyber attacker was able to take 4,400 WBNB worth $1.6 million, 22,000 BUSD worth $22,000, 1.4 million USDT amounting to $1.4 million, 423,000 BURGER tokens worth $3.2 million, along with 142,000 xBURGER worth $1 million, 2.5 ethereum with a value of $6,800 and 95,000 ROCKS." "Burgerswap explained on Twitter that the blockchain security company Peckshield helped with the investigation."

"Since [becoming] aware of the attack, [BurgerSap] suspended Swap, Liquidity, and BURGER generation to fix and resolve the issue. As the latest update, [they] have just resolved all tech issues relating to the attack and have re-opened Swap and Liquidity. More importantly, [they] have put together in place a compensation plan to cover affected users’ losses."

"All users who ... suffered loss as a result of the attack before May 27, 2021, 06:54:46 PM +UTC (Block Height 7781159) will be eligible for the compensation plan." "The compensation token — $cBURGER will be airdropped to those eligible users in proportion to the value of the $BURGER LP they held immediately prior to the attack." "All $cBURGER holders will be able to obtain $BURGER rewards by staking their $cBURGER into the [Compensation Pool] which will release $BURGER in a span of 90 days in a linear proportion."

The BurgerSwap smart contract contained an exploit which allows for an attacker to use a fake coin, which they then used to create trading pairs and ultimately remove funds.

The BurgerSwap team has fixed the specific vulnerabilities and put together a plan to compensate their affected users.

HOW COULD THIS HAVE BEEN PREVENTED?

Special care needs to be taken to ensure that tokens interacted with are expected. While auditing may help reduce the chances of errors, it is not foolproof.

A more secure storage of funds would have the majority in an offline multi-signature wallet.

Check Our Framework For Safe Secure Exchange Platforms

CertiK Blockchain Security Leaderboard (Jun 1)
Introducing Burgerswap A Democratized Amm On Binance Smart Chain (Jun 13)
BurgerSwap Hit by Flash Loan Attack Netting Over $7M - CoinDesk (Jun 17)
@burger_swap Twitter (Jun 17)
@burger_swap Twitter (Jun 17)
Go Forward Plan Cburger (Jun 17)
Cburger Compensation Pool With Tutorial (Jun 17)
BSC Defi Protocol Burgerswap Loses $7.2 Million from a Flash Loan Attack – Bitcoin News (Jun 17)
BurgerSwap Project on Binance Smart Chain Drained of More Than $7 Million (Jun 17)
Profits from raiding Binance Smart Chain dapps in May (Jun 20)
SlowMist Hacked - SlowMist Zone (May 18)
blocksec-incidents/2021.md at main · openblocksec/blocksec-incidents · GitHub (Aug 11)
Rekt - BurgerSwap - REKT (Aug 11)
@frankresearcher Twitter (Aug 11)
@mudit__gupta Twitter (Aug 11)
@haydenzadams Twitter (Aug 11)
@peckshield Twitter (Aug 11)

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