Cover Protocol, a decentralized finance (DeFi) protocol, the market for peer-to-peer coverage, was the DeFi protocol to suffer the latest hack.
Binance has stopped trading
Following this development, Binance took action to stop all trading and deposits of the COVER token.
According to an official announcement on Monday, December 28, 2020, Binance has decided to suspend the trading and depositing activities of the COVER token on its platform. Earlier yesterday, there were reports that hackers were exploiting a bug found in the Cover Protocol’s smart contract.
The error allowed the attacker to print about 40 quintillion tokens, thus inflating the token supply. Also, the attacker has sold over 11,700 Cover tokens per 1 inch, a decentralized exchange aggregator protocol. The attack ultimately caused the COVER token price to fall by more than 90 percent
According to Bateng, a Yearn Finance core developer, the Cover team was unable to stop the continuous issuance of tokens.
Towards the end of November, there was a merger between Yearn Finance and the Cover Protocol.
Research on the subject continues
Bateng also stated that investigations on the issue are continuing. While Binance suspends its trading activities, withdrawals are still possible on the exchange platform.
In response to the incident, the Cover protocol team also stated that they were investigating and halting the hacking.
Cover joins the list of DeFi projects exposed to attacks in 2020. The DeFi protocol bZx was hacked for the third time in September and hackers were seen to steal $ 8 million worth of tokens.
In a report released by cryptocurrency intelligence firm CipherTrace in November, there was an increase in DeFi hacks and exploits, and millions of dollars in losses in the crypto space.