Stars Arena, the Avalanche-based rival of social protocol Friend Tech, has recently confirmed a protocol exploit that resulted in a staggering loss of 266,103 AVAX tokens worth approximately $2.88 million.
Nature of the Exploit
This disturbing revelation has sent shockwaves through the crypto community, raising concerns about the safety and security of smart contracts and the broader blockchain ecosystem.
Stars Arena, in a statement on social media platform X, expressed deep regret over the incident and informed users that the platform was currently under a DDOS attack. However, Blockchain analytics firm CertiK shed light on the nature of the exploit, highlighting the severity of the situation.
CertiK highlighted in a recent post on the X platform that the attack that befell Stars Arena is known as a “reentrancy exploit.” This type of attack occurs when malicious actors repeatedly call a vulnerable smart contract within a single transaction.
Stars Arena have been exploited for 266,103 AVAX (~S2.88m) via reentrancy exploit.
The funds currently sit in EOA 0xa2E which was also involved in an exploit on Stars Arena on 05 October.https://t.co/vYWresLAnB
— CertiK Alert (@CertiKAlert) October 7, 2023
In the case of Stars Arena, the attacker manipulated the platform’s smart contract to siphon off a substantial amount of AVAX tokens. The vulnerable smart contract allowed the transfer of platform-native tokens (AVAX) to external contracts, creating an opening for reentrancy issues.
CertiK notably provided additional insights into the attacker’s tactics. Notably, the attacker altered the values that affect price acquisition within the smart contract. By doing so, they managed to receive a significantly inflated price when selling tokens. Surprisingly, the address used, 0xa2E appears to be no stranger to such exploits.
This Ethereum address was previously implicated in an exploit targeting Stars Arena earlier this week.
Response from Stars Arena
In response to the exploit, Stars Arena is interfacing with its community emphasizing its commitment to resolving the situation. The platform is actively working on a solution to recover the funds and secure its smart contracts against future attacks.
The protocol has assured users that it will keep them updated on the progress, and they have also thanked the community for their unwavering support during this challenging period.
Meanwhile, Stars Arena’s introduction on the Avalanche’s blockchain has had a substantial impact on AVAX’s pricing and network activity. Market participants appear to have hailed the news of the emergence of Stars Arena, as demonstrated by the price increase.
The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.
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