AkuDreams dev team locks up $33M due to smart contract bug

AkuDreams dev team locks up M due to smart contract bug

Aku

A highly anticipated NFT project has been hit with an exploit and a smart contract bug, causing a disruption to its auction and leaving the team with $33 million unable to be accessed.

The highly anticipated NFT project Akutars was marred by both an exploit and a bug on the weekend causing over 11,500 Ethereum (ETH) worth nearly $33 million to be locked forever within a smart contract, inaccessible even to the development team.

The exploit however, was conducted by someone trying to show a vulnerability in the project and not to steal funds via a hack.

The project went live on Friday April 22 with a Dutch Auction, a type of auction where the price lowers until it receives a bid, with the first bid winning the sale as long as the price is above reserve.

The auction opened at 3.5 Ethereum with only 5,495 of the available 15,000 NFTs up for sale and the smart contract set to refund any bidders who were underbid. Holders of an “Aku Mint Pass” were also given a 0.5 Ethereum discount on each minted NFT.

The $33M Bug

In a April 23 Twitter thread explaining the whopping $33 million bug, 0xInuarashi, a developer of multiple NFT projects explained Akutars' smart contract was coded so that refunds to bidders had to be processed first before the team could withdraw any funds.

The contract had a caveat that a minimum number of bids had to be made before it would allow for the team to withdraw, but the minimum number of bids was set to equal the amount of NFTs available for auction.

Unfortunately, due to some buyers minting multiple NFTs within the same bid, the terms of the contract mean it will never unlock, sealing away the nearly $33 million in Ethereum forever.

Cointelegraph contacted the Akutars team for comment but did not immediately hear back.

The exploit

In a now deleted tweet posted by the Akutars that was shared by DeFi developer foobar, it said that developers reached out to them warning that their contract could be exploited but appeared to shrug them off completely as they labelled the potential exploit a “feature”.

The AkuDreams team pretended that this was a feature, not an exploit, when multiple developers raised concerns prior to mint. Bizarre justifications. pic.twitter.com/cVgEXnnWzF
— foobar (@0xfoobar) April 23, 2022

During the mint an unknown individual executed what’s known as a “griefing contract” which locked the ability of the Akutars contract to process refunds to those underbid. The individual even embedded a message on the blockchain to the Akutars team saying they would stop the contract:

“Well, this was fun, had no intention of actually exploiting this lol. Otherwise I wouldn’t have used Coinbase. Once you guys publicly acknowledge that the exploit exists, I will remove the block immediately.”

Akutars then promptly responded by taking responsibility for the code and suggested that the exploit “was not done out of malice” and the person “intended to bring attention to best practices for highly visible projects.”

Quick Update (will go into more detail asap):

1. The exploit in the contract was not done out of malice; the person intended to bring attention to best practices for highly visible projects & novel mechanics. They unblocked the exploit quickly after we dug in and took ownership
— Aku :: Akutars (@AkuDreams) April 23, 2022

In a tweet on the same day, the project's founder and former pro-baseballer Micah Johnson offered an apology to the community, noting that after letting them down he will "continue to build brick by brick" and work tirelessly to avoid any similar issues moving forward.

The team also said that it will be issuing 0.5 Ethereum refunds to pass holders as well as airdropping the NFT to successful bidders.

The mistakes that were made are no more costly to anyone than myself. I’ve reinvested most everything into building Aku.

& most everything will go back to refunds and we will keep building what we set out to do.

Brick by brick. https://t.co/vQiPbl0Jpl
— Micah Johnson (@Micah_Johnson3) April 23, 2022

In an update posted on Sunday April 24 the team said it had rewritten its minting contract which was then audited by several developers and plans to mint on Monday April 25.

This article has been updated, with the headline changing from "$34M" to "$33M"

Hacker bungles DeFi exploit: Leaves stolen M in contract set to self destruct

attacker

A hacker apparently so thrilled by a successful theft left behind over $1 million in a smart contract that was set to destruct, permanently ensuring the crypto could never be moved.

In a rare comedic bungle among DeFi exploits, an attacker has fumbled their heist at the finish line leaving behind over $1 million in stolen crypto.

Just after 8AM UTC on Thursday April 21st, blockchain security and analytics firm BlockSec shared it had detected an attack on a little known DeFi lending protocol called Zeed, which styles itself a “decentralized financial integrated ecosystem”.

The attacker exploited a vulnerability in the way the protocol distributes rewards, allowing them to mint extra tokens which were then sold, crashing the price to zero, but netting just over $1 million for the exploiter.

Blockchain analytics firm PeckShield noted the stolen crypto was transferred to an “attack contract”, a smart contract which automatically and quickly executes the found exploit.

#PeckShieldAlert It appears that @zeedcommunity suffered an exploit. The exploiter gained ~$1m. The gains currently sit in the attack contract. https://t.co/bSHHGM623Q @peckshield https://t.co/jXVj0oGI8B
— PeckShieldAlert (@PeckShieldAlert) April 21, 2022

However the attacker was apparently so excited by their successful heist that they forgot to transfer over $1 million worth of stolen crypto out of their attack contract before they set it to self-destruct, permanently and irreversibly ensuring the funds can never be moved.

Interesting. The hacker kills the contract, but forgets to transfer the profit. https://t.co/HbS2fiztuc https://t.co/uApZyK8Uym pic.twitter.com/FwpZweNLHU
— PeckShield Inc. (@peckshield) April 21, 2022

Using a blockchain scanner to view the attack contract address shows that $1,041,237.57 worth of BSC-USD Binance-Peg token is forever stuck in the contract and the successful self-destruction of the contract was confirmed at 7:15AM UTC on April 21.

It's one of the more bizarre turns of events since the Polygon hacker did an “Ask Me Anything” using embedded messages on Ethereum(ETH) transactions after stealing $612 million from the protocol in August 2021. The question and answer session revealed the attacker hacked “for fun” and thought “cross-chain hacking is hot.”

This latest hack is on the smaller end regarding the amount stolen, and other DeFi protocol hacks have seen hundreds of millions siphoned off as with the recent Ronin bridge hack where attackers made off with over $600 million.

Other notable DeFi exploits include the $80 million worth of crypto stolen from Qubit Finance in January where attackers tricked the protocol into believing they had deposited collateral, allowing them to mint an asset representing a bridged crypto.

DeFi marketplace Deus Finance was exploited in March when hackers manipulated the price feed of a pair of stablecoins resulting in the insolvency of user funds, netting the hackers over $3 million.

defi exploit