MonoX Software Bug - Revision history

Azoundria at 21:58, 10 May 2024

2024-05-10T21:58:37Z

← Older revision		Revision as of 15:58, 10 May 2024
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	[[File:Monoxprotocol.jpg\|thumb\|MonoX Homepage]]MonoX is an innovative DeFi protocol which offers a single token for the liquidity pool instead of pool pairs. Unfortunately, there was a critical design defect in the protocol where the last price update overwrote earlier price updates. This vulnerability was exploited and $31m worth of user funds stored in the smart contract hot wallet were taken. As a new project, they didn't have a large amount of funds available to assist their users, however they are working on a compensation plan.		[[File:Monoxprotocol.jpg\|thumb\|MonoX Homepage]]MonoX is an innovative DeFi protocol which offers a single token for the liquidity pool instead of pool pairs. Unfortunately, there was a critical design defect in the protocol where the last price update overwrote earlier price updates. This vulnerability was exploited and $31m worth of user funds stored in the smart contract hot wallet were taken. As a new project, they didn't have a large amount of funds available to assist their users, however they are working on a compensation plan.

	<ref name="wired-4927" /><ref name="monoxfinance-4928" /><ref name="monoxfinancedocs-4929" /><ref name="monoswapmedium-4930" /><ref name="monoswapmedium-4931" /><ref name="rektnews-4934" />		<ref name="wired-4927" /><ref name="monoxfinance-4928" /><ref name="monoxfinancedocs-4929" /><ref name="monoswapmedium-4930" /><ref name="monoswapmedium-4931" /><ref name="rektnews-4934" /><ref name="carnegieendowment-9983" />

	== About MonoX ==		== About MonoX ==
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	<ref name="muditguptatwitter-4933">[https://twitter.com/Mudit__Gupta/status/1465726874974187524 Mudit Gupta - "An attacker stole $30m from MonoX across their ethereum and polygon deployments a few hours ago. The exploit was caused by a smart contract bug that led to incorrect price updates when doing token swaps." - Twitter] (Dec 28, 2021)</ref>		<ref name="muditguptatwitter-4933">[https://twitter.com/Mudit__Gupta/status/1465726874974187524 Mudit Gupta - "An attacker stole $30m from MonoX across their ethereum and polygon deployments a few hours ago. The exploit was caused by a smart contract bug that led to incorrect price updates when doing token swaps." - Twitter] (Dec 28, 2021)</ref>
	<ref name="rektnews-4934">[https://rekt.news/monox-rekt/ Rekt - MonoX - REKT] (Dec 28, 2021)</ref>		<ref name="rektnews-4934">[https://rekt.news/monox-rekt/ Rekt - MonoX - REKT] (Dec 28, 2021)</ref>

			<ref name="carnegieendowment-9983">[https://carnegieendowment.org/specialprojects/protectingfinancialstability/timeline Timeline of Cyber Incidents Involving Financial Institutions - Carnegie Endowment for International Peace] (Dec 12, 2022)</ref>
	</references>		</references>

Azoundria: Another 30 minutes complete. Additional sources merged in.

2023-10-10T18:00:49Z

Another 30 minutes complete. Additional sources merged in.

Show changes

Azoundria: Another 30 minutes complete. Additional sources merged in. Prevention completed. Information moved around.

2023-09-14T00:28:26Z

Another 30 minutes complete. Additional sources merged in. Prevention completed. Information moved around.

Show changes

Azoundria at 21:33, 7 May 2023

2023-05-07T21:33:34Z

← Older revision		Revision as of 15:33, 7 May 2023
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	{{Imported Case Study\|source=https://www.quadrigainitiative.com/casestudy/monoxsoftwarebug.php}}		{{Imported Case Study 2\|source=https://www.quadrigainitiative.com/casestudy/monoxsoftwarebug.php}}
	{{Unattributed Sources}}		{{Unattributed Sources}}

	[[File:Monoxprotocol.jpg\|thumb\|MonoX]]The blockchain project MonoX had their smart contract hot wallets breached and $31m of user funds were taken. As a new project, they didn't have much funds available to assist their users, however they are working on a compensation plan.		[[File:Monoxprotocol.jpg\|thumb\|MonoX]]The blockchain project MonoX had their smart contract hot wallets breached and $31m of user funds were taken. As a new project, they didn't have much funds available to assist their users, however they are working on a compensation plan.

	This is a global/international case not involving a specific country.		This is a global/international case not involving a specific country.<ref name="wired-4927" /><ref name="monoxfinance-4928" /><ref name="monoxfinancedocs-4929" /><ref name="monoswapmedium-4930" /><ref name="monoswapmedium-4931" /><ref name="blocksecteamtwitter-4932" /><ref name="muditguptatwitter-4933" /><ref name="rektnews-4934" />
	<ref name="wired-4927" /><ref name="monoxfinance-4928" /><ref name="monoxfinancedocs-4929" /><ref name="monoswapmedium-4930" /><ref name="monoswapmedium-4931" /><ref name="blocksecteamtwitter-4932" /><ref name="muditguptatwitter-4933" /><ref name="rektnews-4934" />

	== About MonoX ==		== About MonoX ==
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	!Description		!Description
	\|-		\|-
	\|December 2nd, 2021 ~~12:00:00 AM~~		\|December 2nd, 2021
	\|Main Event		\|Main Event
	\|Expand this into a brief description of what happened and the impact. If multiple lines are necessary, add them here.		\|Expand this into a brief description of what happened and the impact. If multiple lines are necessary, add them here.
Line 77:		Line 76:
	\|		\|
	\|}		\|}

			== Technical Details ==
			This section includes specific detailed technical analysis of any security breaches which happened. What specific software vulnerabilities contributed to the problem and how were they exploited?

	== Total Amount Lost ==		== Total Amount Lost ==
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	== Ongoing Developments ==		== Ongoing Developments ==
	What parts of this case are still remaining to be concluded?		What parts of this case are still remaining to be concluded?
			== General Prevention Policies ==
			There are a number of ways to prevent and mitigate this situation. It is far more secure to have the majority of funds in a multi-signature wallet where keys are stored offline by multiple operators. This would limit the potential loss to only those funds being actively within the hot wallet. Audits can be used to reduce the risks on the hot wallets further, and we advocate at least 2 reviews would be required prior to a project launch. We also propose a comprehensive industry insurance fund which could be available to assist.
			== Individual Prevention Policies ==
			{{Prevention:Individuals:Placeholder}}

			{{Prevention:Individuals:End}}

			== Platform Prevention Policies ==
			{{Prevention:Platforms:Placeholder}}

			{{Prevention:Platforms:End}}

			== Regulatory Prevention Policies ==
			{{Prevention:Regulators:Placeholder}}

	== Prevention ~~Policies ==~~		{{Prevention:Regulators:End}}
	There are a number of ways to prevent and mitigate this situation. It is far more secure to have the majority of funds in a multi-signature wallet where keys are stored offline by multiple operators. This would limit the potential loss to only those funds being actively within the hot wallet. Audits can be used to reduce the risks on the hot wallets further, and we advocate at least 2 reviews would be required prior to a project launch. We also propose a comprehensive industry insurance fund which could be available to assist.

	== References ==		== References ==

Azoundria at 23:59, 27 February 2023

2023-02-27T23:59:58Z

← Older revision		Revision as of 17:59, 27 February 2023
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	{{Imported Case Study\|source=https://www.quadrigainitiative.com/casestudy/monoxsoftwarebug.php}}		{{Imported Case Study\|source=https://www.quadrigainitiative.com/casestudy/monoxsoftwarebug.php}}
			{{Unattributed Sources}}

	[[File:Monoxprotocol.jpg\|thumb\|MonoX]]The blockchain project MonoX had their smart contract hot wallets breached and $31m of user funds were taken. As a new project, they didn't have much funds available to assist their users, however they are working on a compensation plan.		[[File:Monoxprotocol.jpg\|thumb\|MonoX]]The blockchain project MonoX had their smart contract hot wallets breached and $31m of user funds were taken. As a new project, they didn't have much funds available to assist their users, however they are working on a compensation plan.

	This is a global/international case not involving a specific country.		This is a global/international case not involving a specific country.
			<ref name="wired-4927" /><ref name="monoxfinance-4928" /><ref name="monoxfinancedocs-4929" /><ref name="monoswapmedium-4930" /><ref name="monoswapmedium-4931" /><ref name="blocksecteamtwitter-4932" /><ref name="muditguptatwitter-4933" /><ref name="rektnews-4934" />

	== About MonoX ==		== About MonoX ==
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	== References ==		== References ==
	[https://www.wired.com/story/hackers-drain-31-million-from-crypto-service/ A Software Bug Let Hackers Drain $31M From a Crypto Service \| WIRED] (Dec 15)		<references><ref name="wired-4927">[https://www.wired.com/story/hackers-drain-31-million-from-crypto-service/ A Software Bug Let Hackers Drain $31M From a Crypto Service \| WIRED] (Dec 16, 2021)</ref>

	[https://monox.finance/home MonoX] (Dec 27)		<ref name="monoxfinance-4928">[https://monox.finance/home MonoX] (Dec 28, 2021)</ref>

	[https://docs.monox.finance/ ~~�About~~ - MonoX] (Dec 27)		<ref name="monoxfinancedocs-4929">[https://docs.monox.finance/ About - MonoX] (Dec 28, 2021)</ref>

	[https://medium.com/monoswap/the-path-forward-part-2-community-compensation-951d94cb8e65 The Path Forward Part 2 Community Compensation] (Dec 27)		<ref name="monoswapmedium-4930">[https://medium.com/monoswap/the-path-forward-part-2-community-compensation-951d94cb8e65 The Path Forward Part 2 Community Compensation] (Dec 28, 2021)</ref>

	[https://medium.com/monoswap/exploit-post-mortem-33921a779b43 Exploit Post Mortem] (Dec 27)		<ref name="monoswapmedium-4931">[https://medium.com/monoswap/exploit-post-mortem-33921a779b43 Exploit Post Mortem] (Dec 28, 2021)</ref>

	[https://twitter.com/BlockSecTeam/status/1465690478414761992 @BlockSecTeam Twitter] (Dec 27)		<ref name="blocksecteamtwitter-4932">[https://twitter.com/BlockSecTeam/status/1465690478414761992 @BlockSecTeam Twitter] (Dec 28, 2021)</ref>

	[https://twitter.com/Mudit__Gupta/status/1465726874974187524 @Mudit__Gupta Twitter] (Dec 27)		<ref name="muditguptatwitter-4933">[https://twitter.com/Mudit__Gupta/status/1465726874974187524 @Mudit__Gupta Twitter] (Dec 28, 2021)</ref>

	[https://rekt.news/monox-rekt/ Rekt - MonoX - REKT] (Dec 27)		<ref name="rektnews-4934">[https://rekt.news/monox-rekt/ Rekt - MonoX - REKT] (Dec 28, 2021)</ref></references>

Azoundria: Created page with "{{Imported Case Study|source=https://www.quadrigainitiative.com/casestudy/monoxsoftwarebug.php}} MonoXThe blockchain project MonoX had their smart contract hot wallets breached and $31m of user funds were taken. As a new project, they didn't have much funds available to assist their users, however they are working on a compensation plan. This is a global/international case not involving a specific country. == About MonoX == "MonoX is a..."

2023-01-28T04:05:34Z

Created page with "{{Imported Case Study|source=https://www.quadrigainitiative.com/casestudy/monoxsoftwarebug.php}} thumb|MonoXThe blockchain project MonoX had their smart contract hot wallets breached and $31m of user funds were taken. As a new project, they didn't have much funds available to assist their users, however they are working on a compensation plan. This is a global/international case not involving a specific country. == About MonoX == "MonoX is a..."

New page

{{Imported Case Study|source=https://www.quadrigainitiative.com/casestudy/monoxsoftwarebug.php}}

[[File:Monoxprotocol.jpg|thumb|MonoX]]The blockchain project MonoX had their smart contract hot wallets breached and $31m of user funds were taken. As a new project, they didn't have much funds available to assist their users, however they are working on a compensation plan.

This is a global/international case not involving a specific country.

== About MonoX ==
"MonoX is a new DeFi protocol using a single token design for liquidity pools (instead of using pool pairs). This is made possible by grouping deposited tokens into a virtual pair with the vCASH stablecoin. Our first use case for single token liquidity pools will be an Automated Market Maker - Monoswap, which is set to launch in October 2021. In the future, we will be launching lending/borrowing and derivatives products."

"An attacker exploited a vulnerability in MonoX Finance's smart contract to inflate the price of its digital token and then cash out."

"BLOCKCHAIN STARTUP MONOX Finance said on Wednesday that a hacker stole $31 million by exploiting a bug in software the service uses to draft smart contracts."

"The past 24 hours have been difficult, and we’re simply at a loss for words. No apologies and no amount of words can describe how the team has been feeling since the attack transpired. We started building over a year ago with a mission to make DeFi more accessible to users and projects. We appreciate all the support we have received along the way from friends, partners, investors and our community of users."

"First, we wanted to give you a quick breakdown of the addresses that have lost funds and each of these wallets are on top of mind to make right. 406 ETH and 15,523 Polygon addresses have been affected by the hack, and of these addresses, 42 ETH and 2,653 Polygon have been actively LPing in more than just 1 pool. Roughly $31M was drained from the pool as a result of the hack."

"The exploit was caused by a smart contract bug that allows the sold and bought token to be the same. In the case of the attack, it was our native MONO token. When a swap was taking place and tokenIn was the same as tokenOut, the transaction was permitted by the contract."

"Any price updates from swap from tokenIn and tokenOut were independently verified by the contract. With tokenOut being verified last, this caused a massive price appreciation of MONO. The attacker then used the highly priced MONO to purchase all the other assets in our pool and drained the funds. The attack was completed through a script, and was highly organized."

"As a new start up that had only launched our product for 2 months, we are in a tricky situation. Immediate remuneration of $31m to our users and investors is not possible. We also have to be conscious of compensating users with $MONO immediately because that would cause a downward death spiral of the token as users liquidate the $MONO. However, we are working on a strategy to pay back our users in full over time."

"If we can’t recoup the funds by 1/3/2022 we will issue a debt token dMONO for every dollar we are compensating. This token will be non-transferable, and we will deploy a dMONO vault."

"The way our protocol works, we are around 100x more profitable than a regular DEX with a similar TVL. When we relaunch again we will be buying back MONO using our revenue and sending MONO to this vault. Any holders of dMONO can withdraw from the vault at any time by burning their dMONO. When a withdrawal is done it is not reversible. If you choose to withdraw your dMONO before it reaches the owed value, it means you are forgiving the remaining portion of the debt."

"MonoX developers are working to implement new functionality to prevent exploits in the future. We will also be implementing new features to minimize LP risk by offering protocol-owned liquidity via bonds. More details on this to come in the near future."

"We have started to work with Immunefi and will offer an ongoing bug bounty for our product. We will scale the bug bounty amount as our TVL increases." "In the future, we will scale out TVL more slowly and are actively seeking ways to match higher insured amounts for the pool."

"The next iteration of the MonoX protocol will be launched with the utmost attention to security and detail. MonoX will relaunch only after a considerable effort from its developers and safety partners is spent to ensure robust security."

This is a global/international case not involving a specific country.

The background of the exchange platform, service, or individuals involved, as it would have been seen or understood at the time of the events.

Include:

* Known history of when and how the service was started.
* What problems does the company or service claim to solve?
* What marketing materials were used by the firm or business?
* Audits performed, and excerpts that may have been included.
* Business registration documents shown (fake or legitimate).
* How were people recruited to participate?
* Public warnings and announcements prior to the event.

Don't Include:
* Any wording which directly states or implies that the business is/was illegitimate, or that a vulnerability existed.
* Anything that wasn't reasonably knowable at the time of the event.
There could be more than one section here. If the same platform is involved with multiple incidents, then it can be linked to a main article page.

== The Reality ==
This sections is included if a case involved deception or information that was unknown at the time. Examples include:

* When the service was actually started (if different than the "official story").
* Who actually ran a service and their own personal history.
* How the service was structured behind the scenes. (For example, there was no "trading bot".)
* Details of what audits reported and how vulnerabilities were missed during auditing.

== What Happened ==
The specific events of the loss and how it came about. What actually happened to cause the loss and some of the events leading up to it.
{| class="wikitable"
|+Key Event Timeline - MonoX Software Bug
!Date
!Event
!Description
|-
|December 2nd, 2021 12:00:00 AM
|Main Event
|Expand this into a brief description of what happened and the impact. If multiple lines are necessary, add them here.
|-
|
|
|
|}

== Total Amount Lost ==
The total amount lost has been estimated at $31,000,000 USD.

How much was lost and how was it calculated? If there are conflicting reports, which are accurate and where does the discrepancy lie?

== Immediate Reactions ==
How did the various parties involved (firm, platform, management, and/or affected individual(s)) deal with the events? Were services shut down? Were announcements made? Were groups formed?

== Ultimate Outcome ==
What was the end result? Was any investigation done? Were any individuals prosecuted? Was there a lawsuit? Was any tracing done?

== Total Amount Recovered ==
There do not appear to have been any funds recovered in this case.

What funds were recovered? What funds were reimbursed for those affected users?

== Ongoing Developments ==
What parts of this case are still remaining to be concluded?

== Prevention Policies ==
There are a number of ways to prevent and mitigate this situation. It is far more secure to have the majority of funds in a multi-signature wallet where keys are stored offline by multiple operators. This would limit the potential loss to only those funds being actively within the hot wallet. Audits can be used to reduce the risks on the hot wallets further, and we advocate at least 2 reviews would be required prior to a project launch. We also propose a comprehensive industry insurance fund which could be available to assist.

== References ==
[https://www.wired.com/story/hackers-drain-31-million-from-crypto-service/ A Software Bug Let Hackers Drain $31M From a Crypto Service | WIRED] (Dec 15)

[https://monox.finance/home MonoX] (Dec 27)

[https://docs.monox.finance/ �About - MonoX] (Dec 27)

[https://medium.com/monoswap/the-path-forward-part-2-community-compensation-951d94cb8e65 The Path Forward Part 2 Community Compensation] (Dec 27)

[https://medium.com/monoswap/exploit-post-mortem-33921a779b43 Exploit Post Mortem] (Dec 27)

[https://twitter.com/BlockSecTeam/status/1465690478414761992 @BlockSecTeam Twitter] (Dec 27)

[https://twitter.com/Mudit__Gupta/status/1465726874974187524 @Mudit__Gupta Twitter] (Dec 27)

[https://rekt.news/monox-rekt/ Rekt - MonoX - REKT] (Dec 27)