Key Points:
- Onyx DeFi protocol to relaunch its Onyx Core network after a $3.8 million hack on September 27.
- Hack exploited a known vulnerability, leading to a shutdown of its Ethereum-based lending market.
- Proposal (OIP-46) to overhaul the system received unanimous community approval by September 29.
- The revamped protocol will focus on secure, closed-ended lending of NFTs, real-world, and crypto assets.
Relaunch Plans After Hack
Onyx, a decentralized finance (DeFi) protocol, is set to relaunch its Onyx Core network following a significant hack that resulted in $3.8 million in losses. The attack, which occurred on September 27, exploited a vulnerability previously identified in the platform’s codebase. This prompted an immediate proposal (OIP-46) from the Onyx team to shut down its Ethereum-based lending market and fully reimburse lenders.
The proposal was introduced the same day as the hack, and by September 29, it had gained unanimous support from the Onyx community. The relaunch of Onyx Core is scheduled for October 1, with significant changes to its structure. As part of the overhaul, Onyx will issue a revised white paper and transition to a closed-ended lending protocol. This updated system will focus on securely wrapping NFTs, real-world assets, and cryptocurrencies, aiming to prevent future breaches like the one that occurred through an NFTLiquidation contract vulnerability.
Rising Crypto Hack Concerns and Onyx’s Future
Onyx’s recent exploit is one of many that have plagued the crypto industry in 2024. The vulnerability that led to the Onyx hack is rooted in Compound Finance’s version 2 codebase, which has been used by various DeFi protocols. This same flaw was exploited in previous attacks, including one on Onyx in October 2023 and another on Hundred Finance in April 2023.
According to cybersecurity firm PeckShield, the recent Onyx hack resulted in the theft of over $3.8 million worth of digital assets, including 4.1 million virtual USD (VUSD), 7.35 million Onyxcoin (XCN), and smaller amounts of Wrapped Bitcoin (WBTC), DAI, and USDT stablecoins.
Crypto hacks have surged throughout 2024, with centralized exchanges and DeFi protocols being primary targets. The first quarter of the year saw a 42% increase in stolen funds compared to the same period in 2023, with over $542 million in losses. Onyx is part of a growing list of platforms taking decisive action to improve security in response to these escalating threats.
