KyberSwap Elastic Appears Security Vulnerability Causing TVL To Drop 50%

Key Points:

• KyberSwap Elastic currently has a security hole.
• KyberSwap team is investigating further about the event.
• KNC price fell more than 3% after the news, KyberSwap’s TVL dropped significantly more than 50%.

KyberSwap, a DEX aggregator and liquidity provider, revealed that a possible vulnerability in KyberSwap Elastic had been detected.

The team is hopeful that liquidity providers will be able to withdraw money as quickly as possible, and no user assets have been lost so far.

KyberSwap noted that KyberSwap Classic would not be impacted and that further information will be published when KyberSwap Elastic is relaunched.

After the news, the protocol’s native token, KNC, fell by 3.4%.

KyberSwap is Kyber Network’s primary DEX aggregator and liquidity platform, aiming to give traders the best swap prices while enabling liquidity providers to optimize revenues via effective capital management.

The KyberSwap Elastic protocol incorporates all of the characteristics of the KyberSwap Classic protocol, which was the world’s first Dynamic Market Maker.

The Dynamic Market Maker protocol of the KyberSwap Classic helped to optimize costs and returns for liquidity providers depending on current market circumstances prior to the debut of the KyberSwap Elastic protocol. The current KyberSwap protocol, on the other hand, will elevate the experience to a new level with its focused liquidity.

Elastic provides unparalleled flexibility, safety, and rewards. It also has a diverse set of features, primarily for LPs with varying liquidity requirements and risk tolerances. The protocol has the potential to increase KyberSwap’s total liquidity, which will benefit both KyberDAO and KNC holders.

As a result, the pool’s liquidity is employed more effectively, simulating significantly larger levels of liquidity and delivering better slippage, volume, and profitability for LPs. This is particularly useful for stablecoins and linked pairings (e.g., USDC-DAI), which have minimal price volatility.

Elastic had a total value of $108 million locked up yesterday, but that amount has since decreased to $43 million, according to DefiLlama.

DISCLAIMER: The Information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.

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Harold

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