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Osmosis DEX Liquidity Pools Hacked for $5 Million
The official Osmosis Twitter account @osmosiszone denied that the Osmosis liquidity pools were completely drained during the exploit, but did estimate the losses at five million dollars and added that ‘devs are fixing the bug and working on a recovery’.
The latest tweet thread thanked DEX users – the ‘Osmonauts’ for their patience and explained a software error was introduced in the Osmosis v9.0 update that went live this week, but ‘all losses will be covered’.
A small number of hacker wallets were responsible for hacking Osmosis and the DEX core team is confident the stolen funds can be recovered.
The bug involved incorrect calculation of LP shares when adding and removing liquidity from pools and overlooked in internal testing – hackers were able to gain 50% more tokens while doing so.
Security protocols are being upgraded and patched prior to the release of the Osmosis v10 codebase, and the proof-of-stake (POS) Osmosis chain being restarted. It is estimated that could take until June 11th – 12th.
The Osmosis bug was reported in an Reddit thread which wasn’t acted on in time, and deleted by forum moderators.