Akropolis Attacked

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Akropolis

Another decentralized finance attack where multiple code auditors failed to find the exploit.

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

About Akropolis

"Akropolis is a software enabling developers to launch decentralized applications (dapps) that provide cryptocurrency-based financial services owned and operated by users." "Akropolis is a DeFi saving and lending service provider that enables users to generate yield and take out loans on cryptocurrency deposits." "Akropolis was created in 2017 by co-founders Ana Adrianova and Kate Kurbanova." "Akropolis said the areas targeted by the hackers had already been audited twice, and only included “Curve Y and Curve sUSD savings pools.”" "[T]he attack vectors used in the exploit were not identified in either audit." "[T]he news could mark another dent in the code auditing ability of blockchain auditing firm CertiK."

"We recently identified a hack executed across a body of smart contracts in the "savings pools" that have been audited twice. We are working with security specialists and on-chain analytics providers and aim to make a more detailed statement shortly. Thank you for your patience."

"Several of the pools within the project’s Delphi Savings pool for yield farming were drained of over 2 million DAI, worth roughly $2 million." "Blockchain records show the hackers got away with more than $2,051,159 in Dai before moving the funds to a different address." "The essence of the exploit in question is a combination of a re-entrancy attack with Dydx flash loan origination." "The attacker pilfered the platform’s Ycurve pool in batches of $50,000 in the stablecoin DAI. This particular pool allows investors to trade stablecoins and earn interest." “At ~14:36 GMT we noticed a discrepancy in the APYs of our stablecoin pools and identified that ~2.0mn DAI had been drained out of the Ycurve and sUSD pools,”

"Akropolis was attacked by exploiting its flawed handling of the deposit logic in its SavingsModule smart contract." "This incident was due to a bug in the protocol without (1) validating the supported tokens and (2) enforcing reentrancy protection on the deposit logic. The exploitation leads to a large number of pooltokens minted without being backed by valuable assets. The redemption of these minted pooltokens is then exercised to drain about 2.0mn DAI from the affected YCurve and sUSD pools."

"The hacker allegedly created a flash loan to borrow funds with a fake token in the hacker’s own smart contract. As the funds were being transferred, the hacker executed another deposit using $800,000 worth of real DAI borrowed from dYdX. The fake token loan raised the balance of the liquidity pool. When the real loan was initiated, Akropolis minted the same tokens twice, allowing the hacker to withdraw double the intended amount. Akropolis is now monitoring incoming tokens and adding a Reentrancy Guard feature to prevent the same exploit from happening again."

"The DeFi protocol said that it has already given notifications to other leading crypto exchanges regarding the cyberattack and the hacker’s wallet as an effort to have the money stolen frozen and prevent the hacker from laundering those funds into other cryptocurrencies across cryptocurrency exchanges, loss of investigators tracking actions, and withdrawal of the funds from the hacker’s wallets."

"Akropolis says that while it hired two firms to investigate the incident, neither company was able to pinpoint the attack vectors used in the exploit." "Akropolis has since issued a statement on its website stating that “the majority of funds” are safe and it would be pausing all stablecoin pools." "We are extremely grateful for the many expressions of support and offers of help we have received in what is a challenging day for our team." "The Akropolis team said it is looking at ways to reimburse affected users “in a way that is sustainable for the project”." “We are exploring ways to reimburse users for the loss in a way that is sustainable for the project, and will make a proposal to the community prior to any final decision being made.”

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.

Key Event Timeline - Akropolis Attacked

Date	Event	Description
November 12th, 2020	Main Event	Expand this into a brief description of what happened and the impact. If multiple lines are necessary, add them here.

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

The total amount lost has been estimated at $2,000,000 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?

General Prevention Policies

Decentralized smart contracts are similar to hot wallets. It's impossible to know that they're secure, and they let hackers who find any exploits take the funds.

Proper security of crypto-assets is an offline multi-signature wallet held by trained background checked people.

Individual Prevention Policies

No specific policies for individual prevention have yet been identified in this case.

For the full list of how to protect your funds as an individual, check our Prevention Policies for Individuals guide.

Platform Prevention Policies

Policies for platforms to take to prevent this situation have not yet been selected in this case.

For the full list of how to protect your funds as a financial service, check our Prevention Policies for Platforms guide.

Regulatory Prevention Policies

No specific regulatory policies have yet been identified in this case.

For the full list of regulatory policies that can prevent loss, check our Prevention Policies for Regulators guide.