//
LeetSwap Halts Trading After $630K Drained From Liquidity Pairs
Blockchain News

LeetSwap Halts Trading After $630K Drained From Liquidity Pairs

LeetSwap, a decentralized exchange (DEX) running on Coinbase’s Layer 2 blockchain Base, has fallen victim to an attack resulting in the drainage of 340 ether (ETH) from its liquidity provider (LP) pairs. The exchange has taken immediate action to recover the lost funds and is collaborating with on-chain security experts to address the situation.

The attack was revealed through a tweet from PeckShield, which highlighted the security breach on the DEX. LeetSwap acknowledged the incident on its official Twitter account, explaining that its DEX is based on the Solidly fork and had a security pause function in its factory. In response to the potential compromise of some pool liquidity, the exchange temporarily halted trading to conduct a thorough investigation.

As a precautionary measure, LeetSwap informed users that if they had not locked their liquidity, they were free to remove it from the pools. This move aimed to minimize any further potential losses or risks to users’ assets.

Prior to the attack, the DEX had achieved a significant milestone, reaching a peak Total Value Locked (TVL) of $41.2 million on July 31. However, following the security incident, the TVL has plummeted to $7 million as of August 1. The attack has had a substantial impact on investor confidence and the overall attractiveness of the platform.

The security breach at LeetSwap is not an isolated incident on Base. Recently, BALD, a memecoin operating on the same blockchain, also executed a rugpull. In this case, the token’s deployer removed millions of dollars worth of liquidity, leaving its users in financial turmoil.

The incidents at LeetSwap and BALD have raised concerns about the security and reliability of decentralized exchanges on Coinbase’s Layer 2 blockchain Base. As a result, investors and users in the DeFi space are urged to exercise caution and carefully consider the security features and practices of platforms before participating.

The cryptocurrency market remains highly susceptible to attacks and scams, making it crucial for users to stay vigilant and follow best security practices. As the DeFi ecosystem continues to evolve, the industry must collectively work to enhance security measures to protect investors and maintain the credibility of decentralized finance platforms.

Crypto products and NFTs are unregulated and can be highly risky. There may be no regulatory recourse for any loss from such transactions. Crypto is not a legal tender and is subject to market risks. Readers are advised to seek expert advice and read offer document(s) along with related important literature on the subject carefully before making any kind of investment whatsoever. Crypto market predictions are speculative and any investment made shall be at the sole cost and risk of the readers.