LEVYATHAN

DESCRIPTION OF EVENTS

"With Levyathan, enjoy a new experience of Decentralized Finance by taking advantage of the power of Financial Indexes while safely evolving in the Binance ecosystem." "Protect your investments through diversification and rest assured to not miss any opportunity on the different sectors in full expansion."

"The goal of the project is simple: to combine the strength of DeFi assets with the security provided by diversity in the form of Indexes composed of a carefully selected range of assets."

"Besides being effective and easy to access, the product may well foreshadow part of the future of Decentralized Finance. A future where it will no longer be necessary to make a radical choice between high yield and security"

"A Smart Contract flaw has seen Levyathan mint limitless tokens and endure a cataclysmic price drop." "Levyathan.finance sank last week, along with its TVL of $1.5M." "Leviathan’s (LEV) token price fell from $0.15 to an unthinkable $0.00000147 at the time of writing according to CoinGecko data."

"Upon checking wallet activity it has become clear that there has been a considerable breach that has seen the loss of over $100,000k for investors. With the current total supply standing at an alarming 100,000,000,000,000,000,016,620,942.467, there is ample cause for concern."

"The Levyathan developers left the private keys to a wallet with minting capability available on Github." "As it was explained in a previous article, the private key that enabled interaction with the timelock was publicly available on the Levyathan project Github in the governance repository, due to a serious oversight of the developer."

"This availability led to the unfortunate events of July 30, 2021. Indeed, the oversight of the developer allowed a malicious hacker to gain control of the LEV contract and mint an infinite number of tokens before dumping them on the market."

"However, the emergencyWithdraw() logic contained a bug which referenced rewardDebt (a variable related to reward calculation) instead of user.amount as the quantity of tokens to be withdrawn."

"Some users who were quick to withdraw in this way noticed that they were receiving more tokens than expected, and continued to withdraw more and more LEV, depleting the contract and leaving nothing for those who came later."

"In their post mortem Levyathan provided an address to which users could return funds ”in an anonymous manner", which has received 3 billion dog tokens and one PLUGANAL."

"The team later on provided a second address which has so far received ~150,000 BUSD (coming from the first address provided by the Levyathan team)."

“First of all, please accept my sincere apology. After internal investigation, it appears that you are absolutely correct. We failed to address the actual issues in our report, together with the incorrect suggestion of the fixes, ultimately lead to tremendous loss of your asset. Needless to say, we have a lot of reflections that need to be done on our own part. It was a human error, as much as we don’t want to see it happen, we are trying to address it systematically. We have updated our database and automation tools to prevent similar mistakes being made again. […]”

"A multisig has been set up with the help of other community members to ensure the integrity of the process. We thank them for their availability and their will to serve the community in tough times. The address of the multisig is: 0xf3381970372fcA75270C0d67956Fd8D6304377D7."

"As you can see, 265,185 BUSD have already been returned and will be distributed to community members who were victims of the technical flaw in the emergency withdraw function."

"All funds returned by members who benefited from the bug in the emergency withdraw function will be deposited at the above address before being distributed."

"Due to the numerous threats and aggressiveness of some members of the community, the new developers who were to contribute to the project no longer feel comfortable working in this climate and have withdrawn from the project."

"Furthermore, the funds allocated to the development of Levyathan were siphoned off during the hack of the platform and all recovered funds are destined to be distributed to the community : therefore, the project is no longer able to self-finance."

Levyathan provided a simple investment platform where users could invest in a basket of different assets they selected. The only catch was that the token was managed in a smart contract hot wallet, with unlimited minting available to a single operator.

The private key for that operator was breached due to them publishing it online on Github, causing the rapid collapse of the token price. The team made some effort to compensate and then abandoned the project.

HOW COULD THIS HAVE BEEN PREVENTED?

One of the easiest ways to protect against this would have been to set up a multi-signature requirement on the minting contract. Such training for operators would likely have helped.

Check Our Framework For Safe Secure Exchange Platforms

blocksec-incidents/2021.md at main · openblocksec/blocksec-incidents · GitHub (Aug 11)
Post Mortem: Levyathan | by Levyathan | Medium (Aug 29)
@peckshield Twitter (Aug 29)
Rekt - Levyathan - REKT (Aug 29)
Levyathan: Our past and future. Certik admits their responsibility | by Levyathan | Medium (Sep 15)
Levyathan Falls Casualty to Unlimited Mint Exploit Despite CertiK Audit (Sep 15)
Levyathan, the First Financial Index established on Binance Smart Chain - Crypto Daily | Your Daily Source for Crypto Latest News & Information (Sep 15)
Levyathan (Sep 15)
Address 0x6cadA45b257DA674f1169B4e68A59765226Fc9aE | BscScan (Sep 26)
Contract Address 0xf3381970372fcA75270C0d67956Fd8D6304377D7 | BscScan (Sep 26)
Binance-Peg BUSD Token (BUSD) Token Tracker | BscScan (Sep 26)
Binance Transaction Hash (Txhash) Details | BscScan (Sep 26)
Levyathan — What future for the project? | by Levyathan | Medium (Sep 26)

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