Osmosis Chain Halted Amid Possible $5M Exploit

The Osmosis DEX has been halted for emergency maintenance as developers investigate the extent of a liquidity pool exploit.

By Oliver Knight

Jun 8, 2022 at 8:24 a.m. UTC

Updated Jun 8, 2022 at 2:35 p.m. UTC

Osmosis blockchain halted amid exploit(Rahul Pabolu/Unsplash) — Osmosis blockchain was halted amid a $5 million exploit. (Rahul Pabolu/Unsplash)

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Oliver Knight

Oliver Knight is a CoinDesk reporter based between London and Lisbon. He does not own any crypto.

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The Osmosis network was halted by core developers and validators at 02:57 UTC following the emergence of an exploit that may have led to about $5 million being drained from liquidity pools.

The bug was brought to light by a community member on the Osmosis subreddit, although the post was deleted by the forum's moderator.
The exploit came to light when a user deposited funds to a liquidity pool before instantly withdrawing it. The value of the withdrawal was unintentionally 50% higher than the deposit.
The team took 12 minutes to halt the chain after the exploit had emerged, according to a Discord post by Osmosis community analyst, RoboMcGobo.
"I cannot speculate on the cause of the bug, an ETA on the chain restart, or the pools that were impacted because we simply don't know yet," RoboMcGobo stated at 05:47 UTC.
In an update on Twitter, Osmosis wrote: "Liquidity pools were NOT 'completely drained.' Devs are fixing the bug, scoping the size of losses (likely in the range of ~$5M), and working on recovery. More info to come."
Osmosis is a blockchain that is built on the Cosmos framework. It operates a decentralized exchange (DEX) that had $11.8 million in daily trade volume before the chain was halted.
The Osmosis token (OSMO) is 6.96% down over the past 24 hours, according to trades on MEXC.

UPDATE (June 8, 09:15 UTC): Adds time of network halt in first paragraph, information from posts on Discord.

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Oliver Knight

Oliver Knight is a CoinDesk reporter based between London and Lisbon. He does not own any crypto.

Follow @OKnightCrypto on Twitter

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Oliver Knight

Oliver Knight is a CoinDesk reporter based between London and Lisbon. He does not own any crypto.

Follow @OKnightCrypto on Twitter