This past weekend, Dogechain came to a halt all transactions after its engineers discovered a serious flaw in the bridge contracts for the project.
Dogechain has temporarily halted transactions.
On September 10, the creators of the project discovered a flaw and temporarily stopped the production of blocks as a result. The development team said on September 11 that the network had been brought back online and was undergoing continuing repair.
Because of the flaw, potential attackers could have been able to freely mint wrapped DOGE (wDOGE) on the bridge network.
The project stated that the fact that its network currently operates on a Proof-of-Authority (PoA) consensus mechanism made it possible for the team to reverse the “unwarranted minting of wDOGE.” It also stated that the network would continue to run on PoA until the team is fully prepared to transition to a Proof-of-State (PoS) consensus.
Dogechain stated that the problem was caused by a “internal bug” rather than “an exploit or hack,” and the team informed the general public that no Dogecoin (DOGE) had been lost or stolen. It was also said that there had been no loss of “internal monies,” which most likely referred to tokens associated with Dogechain (DC) and wrapped Doge (wDOGE).
However, there are some sources that assert that Dogechain did, in fact, suffer a financial loss. According to the findings of an independent crypto researcher named Crumbs, an attacker took advantage of the weakness and changed up to 316 thousand dollars’ worth of wDOGE into other tokens. It’s possible that some of the funds were sent to Binance in the form of deposits.
In response to Crumbs, Dogechain contributor Roc Zacharias denied the theft and stated that the project “had an internal problem [and] no hack.” He followed by saying, “No monies stolen.” There was neither a bridged-out nor a wasted opportunity, as you seem to imply here.
In spite of their claims, it would appear that Dogechain has expressly blacklisted an Ethereum address that starts with 0x78F05… Additionally, Dogechain’s official narrative of events gives the impression that unjustified funds were minted at one point, despite the fact that those mints have since been undone.
The existence of these facts does not indicate that an offender was successful in committing stealing. On the other hand, it does appear that a single person was responsible for the transactions that would have resulted in a loss of funds.
It should be underlined that Dogechain, and not Dogecoin, is the one that is susceptible to the vulnerability. The two initiatives are not connected in any formal capacity. The goal of Dogechain is to construct a Layer 2 network that will enable users to spend bridged Dogecoin tokens on new apps like decentralized exchanges and NFT marketplaces.
A data leak recently occurred that harmed Shiba Inu token, which is another popular doge-themed blockchain project. However, the vulnerability that was stated above has absolutely nothing to do with this data leak.
Disclosure: At the time that this article was written, the author of this piece owned Bitcoin, Ethereum, and a variety of other cryptocurrencies.
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