Decentralized finance (DeFi) protocol LaunchZone, which is based on the Binance Smart Chain (BSC), suffered an alleged exploit that drained $700,000 worth of funds on 27 February. Over 80% of funds in the protocol’s liquidity pool were drained.
The value of LaunchZone’s native token LZ fell by over 80% as funds were swapped out via PancakeSwap, according to blockchain data from different explorers.
The project’s official Telegram group issued a warning to users not to buy tokens until more information was gathered and requested that they remain calm. LaunchZone has over 44,000 members on its Telegram channel and some 275,000 followers on Twitter.
The BSC ecosystem has seen numerous hacks and exploits over the past year. In October 2022, the BSC suffered a $100m exploit that led to a hard fork. Attackers exploited a cross-chain exploit. In February 2023, Web3 infrastructure company Jump Crypto discovered and revealed a serious vulnerability to the BSC team.
The exploit could have enabled an attacker to mint unlimited tokens by means of malicious transfers. The BSC team fixed the vulnerability before it was made public.
LaunchZone, founded in 2021, is a platform offering yield farming and staking features. The platform has a suite of DeFi tools, including LaunchPad and Dex, and supports cross-chain interoperability, allowing users to transfer assets between different chains.
LaunchZone has yet to make any warnings or announcements on its Twitter page or respond to Cointelegraph’s requests for comment on its Facebook page. Details of the latest attack remain scarce, and it is unclear how much of the funds drained may be recovered.
