2022 has been the year of the broken stablecoin, as countless dollar-pegged crypto assets have de-pegged their dollar value this year.On August 14, the polka dot-based stablecoin, Alpaca USD ( AUSD), whose value fell below the U.S. penny, bounced back to $0.95 territory a few hours later. According to reports, the Akala protocol was compromised and the attackers managed to mint AUSD 1.2 billion.
Polkadot’s AUSD stabled coins are well below $1 parity
Besides USDTand many other stable coins such as USDC and DAI had a terrible year in terms of holding their USD value. The Terra USD (UST) depeg, now known as USTC, collapsed the entire Terra ecosystem, evaporating over $40 billion from the crypto economy. After that event, stablecoins such as Waves’ Neutrino USD (USDN), Abracadabra’s Magic Internet Money (MIM), and Tron’s USDD fell below the $1 level.
JUST IN: Hackers printed $1.2 billion
exploited in the Acara network, printing $1.2 billion.
Terra’s USTC did not revert to a $1 peg while, USDN, MIM and USDD were all swapped. , USDN, MIM, and USDD were swapped at $0.99 per coin on August 14, 2022. However, on the same day, the polka dot-based stablecoinAlpaca USD (AUSD)lost a peg, hitting an all-time low of about $0.006383 per unit on Sunday, according to coinmarketcap.com data. At 3:15 p.m. ET as of this writing, the AUSD price bounced back to the $0.95 level, but then quickly dropped to $0.01165.
Polkadot’s Akala network tweeted about the issue just before the AUSD’s value fluctuated significantly. The official Twitter feed of Acala Network wrote, “We are aware of a configuration issue with the Honzon protocol that affects the AUSD.” We are passing an emergency vote to suspend Acala operations while we investigate and mitigate the issue. We will report back once we are back to normal network operations.” The team added.
Changpeng Zhao (CZ), CEO of Binance, alsotweetedabout the AUSD situation, CZ writing:
ACALA protocol is now compromised. Apparently there is a bug in the iBTC/AUSD pool and [the attacker’s] wallet currently holds over 1 billion AUSD. We are monitoring. (AUSD is not listed on Binance).
Acala Protocol Says ‘Misconfiguration’ Resulted in ‘Error Mints of Significant Amount of AUSD’
A series of other reportsstated that hackers succeeded in minting 1.2 billion AUSD, ultimately causing a stablecoin de-pegging incident. A few hours later, Akala confirmed that there was an error that resulted in the minting of a large amount of AUSD.” We have confirmed that the problem was a misconfiguration of the iBTC/AUSD liquidity pool (which went live earlier today) that resulted in a large volume of AUSD error mints.” The teamsaid on Sunday
Acala said that “the misconfiguration has since been corrected” and that the team has successfully identified the wallet that received the incorrectly minted AUSD tokens.Acala published this news at 7:59 AM EST, noting that an on-chain investigation is underway It stated.
“Pending the Acala community’s collective governance decision on [resolution] of the error casting, these incorrectly minted aUSDs that remain in the Acala parachain along with these swapped Acala parachain native tokens have been transfer disabled are being transferred invalid,” the team added. Despite this news, the AUSD USD remains at $0.01159 per coin at 4 pm EST, at least according to coinmarketcap.com’sAUSD market data. .
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