The Polkadot ecosystem-based Defi platform, Acala, is currently down in the cryptocurrency markets and has ceased operation. The series of events on the decentralized platform for the past few days has been wrecking and terrifying.
The decentralized platform was hacked on the 16th of August by cyber-criminals, who minted and transferred aUSD worth $1.2 billion. To make reclamations move, the network team has burnt all the illegally minted coins.
Acala Network Burns 99% of aUSD Minted By Hackers
Following the malicious attack made on the Defi platform, the network community has decided to burn the illegally minted stablecoins. The platform network was allegedly attacked by unknown hackers a few days ago who broke into the system via malicious means. $1.2 billion worth of the platform stablecoins, aUSD was minted and stolen.
Following the fraudulent act, the network banned all operations on the network and met with its community members and Governing council. After the meeting, the council proposed burning all the illegally minted coins by the cyber-criminals.
The Governing council proposal was deliberated and approved. The burning occurred earlier; unfortunately, 99% of the minted stablecoins could be burnt. 1% of the minted stablecoins have moved away from the network parachains and converted to other token and liquidity pools.
The on-Chain analysis predicts that approximately aUSD worth $1.6 million can be retrieved from the fraud act. Following the erroneous minting and fraud, aUSD price dropped drastically to its lowest lows, $0.009 on Sunday.
The fraudulent activity caused an uproar for aUSD community users and even Polkadot ecosystem users. Presently aUSD trades at $0.91, which is a reclamation from its lowest lows of $0.009 on the 14th of August.
Acala Network Exploited by Hackers/Cyber criminals
Acala network stable token, aUSD worth $1.2 billion, was minted by hackers who broke into the platform on the 14th of August. Immediately after the fraudulent practice was detected, the decentralized platform stopped all activities and operations. However, the hackers had successfully minted the coins before the team got wind of the scam.
Acala developer teams swung to action immediately and promised users to investigate and trace the fraud committed. After hours of investigation, the team deciphered that the minted stablecoins were still in the network parachain. However, the coins were moved into different active addresses.
The addresses were traced via on-chain activities, and five were involved in the scamming incident. All the fraudulently minted aUSD’s were banned and stooped from transferring the assets out of the network Parachain till the community Governing council decided.
The fraudulent act on the Acala network triggered many mixed reactions, as the Polkadot ecosystem was accused of being insecure, or maybe the decentralized finance was. A well-known cryptocurrency figure and CEO of Analog, Victor Young, also lashed the ecosystem.
Young stated that “Polkadot security is well built and secure; however, I don’t think that can be said about Acala. Such act being performed easily on a stablecoin platform, we may keep experiencing such if Defi platforms don’t design their applications well”.