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Decentralized finance (DeFi) protocol Kyber Network has asked liquidity providers of KyberSwap Elastic to withdraw funds after it discovered a potential vulnerability.
The DeFi protocol tweeted, “We have identified a potential vulnerability, and as a precaution we strongly advise all Liquidity Providers to withdraw your funds on Elastic as soon as possible. Investigations are ongoing and no user funds are lost.”
Steep Drop in KyberSwap Elastic TVL
Kyber Network also assured that KyberSwap Classic, the sister product of KyberSwap Elastic, is unaffected by the vulnerability.
After the announcement, users withdrew over $56 million from KyberSwap Elastic. According to data from DefiLlama, the Total Value Locked (TVL) dropped from around $108 million to $52 million. That’s a drop of over 50% within a couple of hours of the announcement.
Although, as of writing, there is not much impact on the price of the Kyber Network Crystal (KNC) token. According to data from TradingView, the price of KNC is down by roughly 0.6%, post the tweet warning about vulnerabilities.
The project may have dodged the bullet this time, but in September 2022, it lost $265,000 to a front-end exploit. Last month, a Kyber Swap user received only 0.05 USDT while swapping 2 million USDC due to a routing error.
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Disclaimer
In adherence to the Trust Project guidelines, BeInCrypto is committed to unbiased, transparent reporting. This news article aims to provide accurate, timely information. However, readers are advised to verify facts independently and consult with a professional before making any decisions based on this content.
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