Exchange Ranking
Top Exchanges
24h Volume Ranking
Popularity Ranking
Exchange BTC Balance
Proof of Reserves
Decentralized Exchanges
Funding Rate
Funding Heatmap
Liquidation Data
Max Pain
Long/Short Ratio
Whale L/S Ratio
Binance/Okex/Huobi L/S
Bitfinex Margin L/S
ETF Tracker
Solana ETF
XRP ETF
Hong Kong ETF
Bitcoin Treasuries
Crypto Reversal
Ethereum Reserves
HyperLiquid Wallet Analysis
Hyperliquid Whale Watch
Large Transactions
On-chain Movement
Bitcoin ROI
Stablecoin Market Cap
Options Analysis
News
Articles
Economic Calendar
Features
Wallet
Contract Calculator
Security
Collections
Watchlist
Following
BTC Balance Coin was hacked due to a oracle vulnerability, plunging 99.8%, and US$912,000 was looted.
Hackers used the oracle vulnerability, causing Balance Coin to plummet 99.8%, about US$912,000 was swept away, and its peg to the US dollar also completely collapsed. Due to the lack of security mechanisms, manipulated bitcoin price data triggered a series of discount liquidations, allowing hackers to make profits through arbitrage transactions.
When millions of newly minted BLC tokens poured into PancakeSwap, liquidity instantly dried up, leaving the 42DAO with huge bad debts and unresolved debt problems.
Balance Coin (BLC) lost its peg to the U.S. dollar after hackers exploited a 42DAO protocol vulnerability, and the value of algorithmic stablecoins plunged 99.8%. The vulnerability resulted in an agreement loss of approximately US$912,000, and the BLC price dropped to approximately US$0.0013 in a short period of time.
According to analysis by blockchain security companies PeckShield and SlowMist, the attacker completed the attack with just a blockchain transaction by abusing weaknesses in the oracle pricing and clearing mechanism in the protocol. Their analysis showed that due to the lack of security checks, manipulated price data triggered a series of rapid liquidations before the system had time to respond.
In addition, after obtaining collateral, the attackers sold millions of newly minted BLC tokens on PancakeSwap, draining available liquidity and accelerating the collapse of stablecoins.
Oracle pricing failure triggers rapid clearing
According to PeckShield and SlowMist, the attack started when the protocol's Spotter contract accepted the wrong Bitcoin price from the BTCB oracle. The contract did not reject the abnormal value, but updated the system because it lacked a filter to detect extreme price deviations.
In addition, the pricing module does not have safeguards in place to limit the extent to which asset values may fall in a single update. As a result, the manipulated bitcoin price immediately flowed into the agreement's clearing system.
False prices entered the Dog contract responsible for managing platform clearing. Because the agreement lacked a clearing delay mechanism, the contract responded directly to manipulation of data without additional verification.
Eventually, multiple large bitcoin mortgage vaults were liquidated at significantly discounted prices, allowing attackers to obtain collateral at below the market price and then profit through arbitrage.
Liquidity depletion exacerbates agreement losses
After liquidation was completed, attackers dumped millions of newly generated BLC tokens on PancakeSwap. The huge selling pressure quickly exhausted remaining liquidity, causing the value of stablecoins to fall to near zero.
More seriously, this attack not only left the 42DAO burdened with huge amounts of bad debts, but also exposed loopholes in its risk management framework. The researchers note that the agreement uses the common DeFi architecture but fails to retain the oracle protection mechanism that helps prevent manipulated price data from triggering clearing.
The collapse of Balance Coin highlights the importance of strengthening oracle security in decentralized finance. At the same time, the 42DAO team has not announced a recovery plan or compensation plan for affected users.
