The DeFi protocol smart contracts of the Hedera project have suffered a significant loss of $5 million following a recent hacker attack and the subsequent suspension of Hedera’s services.
DeFiLlama’s analysts reported a 16.8% decrease in Hedera’s total value locked (TVL) from $29.6 million to $24.6 million per day.
The Hedera developers at the HBAR Foundation noticed network outages on Thursday, March 9, affecting apps and users. They have reassured those impacted that they are working on a solution to the problem.
On Friday, March 10, the project creators confirmed a system hack was behind the failure and revealed how hackers utilized the main network’s smart contract service code to withdraw tokens from clients’ wallets on the Hedera Token Service platform.
Although the attackers tried to transfer tokens through the HashportNetwork blockchain bridge, their suspicious activity was noted, and the service was disabled.
It is still uncertain whether the hackers took clients’ assets and if so, how much. The company is now investigating and fixing the issues associated with the vulnerability.
The Hedera team has turned off the servers of the main network to ensure the security of users, and access will not be opened until the problems are fixed.
Cybersecurity experts from PeckShield released a report earlier in March stating that hackers stole $35.5 million worth of cryptocurrencies in February, with the largest number of hacks occurring on February 11.
The report found that the most significant amount that hackers were able to steal in a single project was $9.2 million.
Last year, the Hedera Hashgraph network launched a $155 million HBAR fund to stimulate the development of DeFi. The HBAR Foundation’s responsibility is to develop the Hedera ecosystem by providing grants and other resources to developers.