Though crypto hacks have been prominent since the blockchain industry emerged, blockchain security firms are working hard to bring security and transparency to the sector. This time, BlockSec, a smart-contract auditing firm dedicated to building a security infrastructure, has prevented a hacker from stealing $5 million in crypto funds on ParaSpace.
ParaSpace is a decentralized lending protocol allowing users to lend or borrow various crypto assets on the Ethereum blockchain. Besides the platform enabling users to lend NFTs or other assets to receive a percentage in the form of interest, ParaSpace lets the users use borrowed funds as collateral.
The vulnerability in the lending protocol of this smart contract enabled the hacker to borrow assets with fewer NFTs than required as collateral, allowing the attacker to drain liquidity protocol. Fortunately, the exploiter failed in its first attempt to execute the transaction due to insufficient gas fees he has. Meanwhile, smart-contract auditing platform BlockSec detected the hack and modified the protocol in time to prevent the hacker from liquidating the crypto asset.
Abeerah Hashim, an Associate Editor at PrivacySavvy, a trusted cyber security website, initiated a warning as a group of crypto publishers reached out.
“While it’s great to see BlockSec successfully prevent this attack, it’s critical to note that vulnerabilities in security systems can still exist. As cyber attackers continue to evolve and develop new methods, it’s crucial for companies to regularly assess and update their security measures to stay ahead of potential threats.”
ParaSpace Paused Operations After Hack
To comment on the incident, ParaSpac
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Author: Jammy Hunts
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