Security First in opBNB, Learnt from Layer 2 Incidents

September 19, 2023 · 9 min read

SCS@HashDit

TL;DR

This incident report aims to aggregate all the incidents that have happened on Layer 2. For context, the Layer 2 chains considered in this report are respective to Ethereum Layer 1 blockchain.

Optimism
Arbitrum
Avalanche
BASE

In total, there were a total of 57 cases, 52 incidents in 2023 and 5 incidents in 2022.

An examination of the yearly breakdown highlights that the total loss in 2022 and 2023 amounts to $149,278,400, namely 13.07% was for 2022 and 86.93% for 2023.

Type of projects

When comparing the types of project with the observed financial loss, a whopping 99.8% of financial loss were attributed to DeFi projects. The second most was a GameFi project at 0.18% (TalesofElleria – Signature compromised), followed by MEV at 0.01% (an unknown MEV contract had a lack of validation bug).

With a large proportion of fiat loss associated with DeFi projects, this shows that DeFi projects are still the most common type of crypto project on L2 chains.

Chain comparison

According to our data, 38.82% of financial loss was from the Arbitrum chain (~$57.95m). BASE being a new chain, accounted for 22.84% (~$34m). This is followed by Optimism and lastly Avalanche.

On Optimism, there were 7 hacks and 1 scam cases. On Arbitrum, there were 23 hacks (including a White-hat) and 9 scam cases. On Avalanche, there were 9 hacks (including a White-hat) 2 scam cases. On BASE, there were 2 hacks and 4 scam cases.

Attack Type analysis

The next chart shows the attack type analysis for all the security incidents on L2 chains. 58.53% was because of Hacks, 40.31% was due to Scams, while 1.17% was rescued by a White hat.

The next chart shows the specific attack vector analysis.

As seen in the chart above, the highest financial loss attributed to rugpulls with $56.75m, $28.6m was due to MPC compromise (Multichain incident), and $9m was due to Internal accounting.

Further analyzing the top 3 attack vectors, Rugpulls - 13 cases (Most notably the $BALD case). MPC compromise - 3 cases (1 Multichain incident across 3 chains). Internal accounting - 2 cases (Mostly due to the Platypus case).

Top 10 incidents on L2 thus far

The following were the top 10 security incidents on L2, 3 of them were scams while the other 7 were exploit cases.

BALD - $25.6 Million Scam

On 1-Aug-2023, BALD, a meme token on BASE was reported to have rug pulled $25.6 million USD from investors. Method: The liquidity of the BASE tokens were held by an EOA account, hence the account could remove liquidity at any time. Although the Base network is meant to be used for developer testing, some people have tried to trade on the network before its official launch https://decrypt.co/150647/bald-coin-based-ethereum-base-layer-2-coinbase Since removing liquidity though, he has appeared to still be adding/removing small chunks of liquidity (probably still trying to garner traffic) https://basescan.org/token/0x4200000000000000000000000000000000000006?a=0xfcd3842f85ed87ba2889b4d35893403796e67ff1

Multichain - $28.6 Million Exploit

On 10-July-2023, a Bridge project, Multichain had its MPC account compromised by an unknown entity. The MPC account had authority over the bridged funds of users, and transferred all the funds to his own wallet, on 3 chains: Arbitrum, Optimism and Avalanche. Since the MPC account appears as a normal EOA on-chain, it is unclear how the MPC account was compromised on the backend.

Defrost - $12 Million Scam

The Defrost project was rugged for a total of $12 million USD on 23-Dec-2022. The incident happened on Avalanche. Method: The privileged owner was an EOA which could change the address of the oracle, in a market contract. He changed the address maliciously to one that returns fake prices, to liquidate their users and seize their funds. At that point of time, it looked pretty obvious that it was a rugpull. However, the project party claimed that they were hacked 4 days later and stated that the exploiter has returned 100% of funds to them https://medium.com/@Defrost_Finance/hacked-funds-returned-to-defrost-71b9d2d1b458 In this case, it appears that they were caught so they returned the funds back.

Platypus - $8.75 Million Exploit

On 17-Feb-2023, Platypus, a Lending/Borrowing project, was exploited, resulting in users losing more than $8.75 million USD. The incident happened on Avalanche. Root cause: The project party overlooked the EmergencyWithdraw() method and forgot to include a check for borrowed funds https://twitter.com/danielvf/status/1626340324103663617?s=61&t=gr5sMl7K7qjCB7l3zmh53w Method: The hacker deposited funds, borrowed funds and then exited his position with EmergencyWithdraw(), allowing him to keep the borrowed funds

Jimbos - $7.5 Million Exploit

On 2023-05-28, Jimbos Protocol on Abitrum was exploited, which resulted in ~$7.5m funds loss. Root cause: The protocol did not have proper measures to manage price changes during operations that shift liquidity. This oversight allows the protocol's own liquidity to be put into a distorted price range, which allows attackers to make "profit" via a reverse swap. Method: 1) The hacker initially flash loaned 10,000 WETH 2) Subsequently swaps them for $JIMBO, inflating its price 3) Called the shift() method in JimboController to manipulate reserves and imbalance the pool 4) Following the manipulation, the attacker converted the acquired Jimbo tokens back into ETH

Exactly - $7.32 Million Exploit

Exactly Protocol, a Lending/Borrowing platform was hacked on Optimism for $7.32m. Root cause: Lack of validation -> allowed the attacker to steal users’ collateral assets

The attacker was able to bypass the permit check in the leverage function of the DebtManager contract by directly passing a fake market address without validation

Untrusted external call done with the fake market address -> the attacker reentered the crossDeleverage function in the DebtManager contract and stole the collaterals from the _msgSender.

Secondly, the Permit calldata p can be externally controlled too, changing the _msgSender to the victim address (user EOA address).

Hundred Finance - $7 Million Exploit

Hundred Finance, a Lending/Borrowing platform was hacked on Optimism for $7m. The hack was due to a known bug in Compound V2 code.

Root cause: The exchange rate can be manipulated because of a rounding issue in the redeemFresh of CToken pool contract (The attacker strictly controls the input quantity every time they call the redeemUnderlying function. This leads to a situation where the calculated result becomes 1.99999999999... but is rounded down to 1 by default.)

Lodestar Financ - $6.9 Million Exploit

Lodestar Finance, a Lending/Borrowing project, was hacked on Arbitrum for $6.9m. This attack vector is 1 variation of the donation-bug vulnerability.

The attacker first manipulated the exchange rate of the plvGLP contract to 1.83 GLP per plvGLP, "an exploit that by itself would be unprofitable", said the company.

Then, the attacker supplied plvGLP collateral to Lodestar and borrowed all available liquidity, cashing out part of the funds "until the collateralization ratio mechanism prevented a full liquidation of the plvGLP."

Following the hack, "several plvGLP holders also took advantage of the opportunity and also cashed out at 1.83 glp per plvGLP." The hacker was able to burn a little over 3 million in GLP, making profit on the "stolen funds on Lodestar - minus the GLP they burned.", noted the DeFi platform.

Magnate Finance - $6.4 Million Scam

Magnate Finance, a scam project, rug pulled for $6.4m. Incident was on the BASE blockchain. Moments before the rug, it was found that its deployer address is directly linked to the Solfire $4.8M exit scam.

The project team manipulated the price oracle value, so he could drain all the locked funds in the market contract.

Deus DAO (DEI) - $5 Million Exploit

On 6-May-2023, the DeusDAO (DEI) project was hacked for slightly more than $5 million USD due to a wrong contract upgrade. The project was hacked on Arbitrum. The upgrade bug introduced a public burn vulnerability, which allowed attackers to steal funds from other wallets that have DEI tokens.

The issue was specifically in the burnFrom method, which wrongly swapped the 2 parameters of msg.sender and the account to be granted approval. The hacker essentially approved DEI tokens to a whale account with a large amount of DEI tokens, and then invoked the wrongly implemented burnFrom method with 0 tokens. This approves all the DEI tokens to the caller instead, where he can just simply call transferFrom and steal all his tokens.

Conclusion:

L2 blockchains offer several advantages over traditional L1 chains such as Increased Scalability, Lower Fees and Faster Transaction Times. However, the issues that plague L1 chains do persist on L2 chains as well.

Therefore, we advise the opBNB community to pay more attentions on the below segments.

Developers' concerns
Users' concerns

Developers should

Pay special attention to over-centralization. Privileged roles should be transferred to a multisig or timelock.
Pay attention to oracle / price manipulation attacks. Ensure the oracle is a trusted source, and use a backup oracle to check discrepancy so that prices will not deviate too much.
For lending/borrowing projects, pay close attention to exchange rates to ensure the rate cannot be manipulated by forceful donation and breaking any invariants.
Ensure all state-changing functions have proper checks for all parameters so there will not be a situation of having unexpected inputs not validated.
Ensure all token standards are followed.
Ensure contract upgrades are done after review from a trustable auditor.

Users should

Invest in trustable tokens, instead of over centralization and hype meme coins as such projects are high risks and might result in it being scams.
Invest in projects that have partnered with 3rd party security companies.

For further inquiries or clarifications, do drop us an email at support@hashdit.io! Stay safe!

PancakeSwap September 14th Weekly Security Report

September 14, 2023 · 4 min read

Sebastian Lim

SCS@HashDit

Disclaimer

The information provided through the BNB Chain community does not constitute advice or recommendation for investment or trading. Projects are listed in no particular order below. BNB Chain does not take responsibility for any of your investment decisions. Please seek professional advice before taking financial risks.

Contract names are there for reference only, there may be legitimate contracts which share the same name, always double check The contract addresses which are the unique identifier of any smart contract.

Overview

PancakeSwap is the most popular decentralized exchange native to BNB Chain. You can swap tokens, invest in yield farms and liquidity pools, and buy and sell collectibles. It is part of the ever-growing world of decentralized finance protocols.

PancakeSwap stands tall as the flagship DeFi platform within the BNB Smart Chain (BSC) ecosystem, however, risks exist in every DEX and blockchain ecosystem. HashDit diligently checks projects every week to identify potential threats within the PancakeSwap landscape, ensuring your trading experience is protected. Consider HashDit as a trusted guide that helps you navigate in DeFi by highlighting potential hazards and keeping your journey secure. Remember, vigilance and a proactive approach are vital for a safe and successful DeFi experience.

High Risk TVL protocol on PCS

In this week, there were 41 newly identified risky addresses. Trending newly identified risky addresses:

Address	ContractName	Weekly Active Transactions
0xb1a1d06d42a43a8fcfdc7fdcd744f7ef03e8ad1a	HongKongDAO (HKD)	375
0xac68931b666e086e9de380cfdb0fb5704a35dc2d	BNB Tiger INU https://bnbtiger.top/	317
0x8624b3a4f29620390d06286df207f6791c243389	GDPToken	297
0xd9628be9ef42b75ca171128e8ce32eceecd858fd	ZGC (ZGC)	289
0x6f9f7632cc42397a1e062db5346f2a9f9bc73e92	BTR	178
0x0a4e1bdfa75292a98c15870aef24bd94bffe0bd4	FOTAToken	117
0x57ca2436f9f54f4909a521e24768e21e322cae88	JUPITER	115
0x56b331c7e3d68306f26e07492125f0faa9d95343	Alcazar: LEO Token	78
0x000000000482aa9817645c3d56aa2230f6573532	GPTChat (GPTC) - Fake_Phishing685	76
0x014a087b646bd90e7dcead3993f49eb1f4b5f30a	GulfCoin	41

Key themes on high risks:

Exactly half of the newly identified risky addresses (56%) were through threat intelligence. These addresses are either confirmed rugpulls (project has already removed rugged) or scam tokens that have high risk of rugs.
Red Alarm projects are manually identified by our security team for being potential scams. These are identified from a project level, for example projects that utilize fake social media marketing, or create scam meme projects. They are labeled under the DApps section of this page(29%)
Another theme for these contracts is that they have a privileged role, e.g owner is an EOA, which could mean some centralization risk as the owner can mint or toggle honeypot mode at will, so there could be rugpull risk. This portion represents 5% of the total newly identified risky addresses.

Refer to this link for the full list.

Tip: Filter by Top_TVL_Risky_Pool / Trending_Risky_Pool / Trending_Risky_Tokens to retrieve the risky addresses from different sources.

Integrations with PancakeSwap

Hashdit has partnered with PancakeSwap to integrate the DappBay’s Red Alarm. The risk score level reflects how risky the interacted token is, helping users make better informed decisions.

Example: Fake Circle Token - 0x84ef2e2e977062da3cfc12c038fa3ce2d42d01b1

The RedAlarm keyword will link to the risk scanner as seen in the image below.

Please take note that the risk level in Pancake & Risk Scanner might be different, because Hashdit use more conservative strategies for PancakeSwap than DappBay risk scanner.

Stay Safe!

HashDit advises you to act with caution in general, but ask that you take particular care when dealing with the projects we highlight as risky on our weekly update. Continue enjoying the BNBChain ecosystem and most importantly, stay SAFU!

About HashDit?

HashDit is building a safe blockchain ecosystem on BNB Chain by providing threat intelligence, code auditing and instant analysis for smart contracts. In the vast and ever-evolving world of Defi investing, HashDit stands as a beacon of trust and knowledge for everyday investors. HashDit is a member of AvengerDAO, which is a community-driven initiative created to protect users and projects on BNB Chain from malicious actors and activity.

PancakeSwap September 7th Weekly Security Report

September 7, 2023 · 4 min read

Sebastian Lim

SCS@HashDit

Disclaimer

Overview

High Risk TVL protocol on PCS

In this week, there were 55 newly identified risky addresses. Trending newly identified risky addresses:

Address	ContractName	Weekly Active Transactions
0xdd63525fab69a97224962a076a642bfcf0714f2e	DMD (DMD)	2688
0x9a2478c4036548864d96a97fbf93f6a3341fedac	ZILLION AAKAR XO (ZAX)	1399
0x78997aa5d48efe1c96415e0d941ba687cdc1c358	MC	1313
0x8d445b83bc7835d2a35a6ec681a10e2006928f73	BRIToken	1145
0x0566b9a8ffb8908682796751eed00722da967be0	FGDTOKEN (FGD)	682
0x14beb72194866e1b4d6ffad3cd5b488f76168b61	BITCOINBattle	378
0xa4a66d8a705260c8cb1ebb59224e018015294f48	Ted (TED)	327
0xb12e8eb6b1f24e14381514d2f3b75e7c61487016	GSD (GSD)	124
0x066cda0cca84e9c6ed0a4ecb92aa036a9582544b	SonicInu	121
0xcc780503e290274cfa8da085528067e259df58f0	GLC	121

Key themes on high risks:

Exactly half of the newly identified risky addresses (56%) were through threat intelligence. These addresses are either confirmed rugpulls (project has already removed rugged) or scam tokens that have high risk of rugs.
Red Alarm projects are manually identified by our security team for being potential scams. These are identified from a project level, for example projects that utilize fake social media marketing, or create scam meme projects. They are labeled under the DApps section of this page(25%)
Another theme for these contracts is that they have a privileged role, e.g owner is an EOA, which could mean some centralization risk as the owner can mint or toggle honeypot mode at will, so there could be rugpull risk. This portion represents 7% of the total newly identified risky addresses.

Refer to this link for the full list.

Tip: Filter by Top_TVL_Risky_Pool / Trending_Risky_Pool / Trending_Risky_Tokens to retrieve the risky addresses from different sources.

Integrations with PancakeSwap

Hashdit has partnered with PancakeSwap to integrate the DappBay’s Red Alarm. The risk score level reflects how risky the interacted token is, helping users make better informed decisions.

Example: Fake Circle Token - 0x84ef2e2e977062da3cfc12c038fa3ce2d42d01b1

The RedAlarm keyword will link to the risk scanner as seen in the image below.

Please take note that the risk level in Pancake & Risk Scanner might be different, because Hashdit use more conservative strategies for PancakeSwap than DappBay risk scanner.

Stay Safe!

About HashDit?

BNB Smart Chain Monthly Incident Report August 2023 - 60% drop of total incident amounts

September 7, 2023 · 3 min read

Sebastian Lim

SCS@HashDit

Introduction

According to Hashdit, the amount of losses on BNB Smart Chain (BSC) in August 2023 have greatly decreased compared to July.

In August, there were over 27 typical security incidents, with a total loss of approximately $4.5 million, a decrease of about 60% compared to July.

In general, the data has trended downwards from July to August, which is a good sign.

The total amount involved in Hack incidents dropped to $507k from $4.7 million, a decrease of about 89% compared to July. The total amount involved in Scam incidents dropped to $4 million from $6.8 million, a decrease of about 40% compared to July.

The number of Hacks decreased to 4 from 19, a 78% decrease from July. The only data that trended upwards was the number of Scams increased from 13 to 23, a 76% increase from July.

Figure 1: Comparisons between July (Blue) and August (Red) in terms of Amount Loss ($$) and Number of Incidents

The largest security incident this month occurred with a fake LayerZero token, resulting in a loss of approximately $1 million. There has been an increase in exit scam incidents this month, with notable cases including a $680k rugpull by the NFT_SalesRoom (ASN) team. Additionally, there has been an increase in fake tokens that conducted a rugpull such as 2 Fake $CIRCLE tokens, 1 Fake $Zksync token and 1 Fake $X token.

Security Control Improvements in the BSC Ecosystem

HashDit has integrated its security API with Prominent and Leading brands on BSC such as PancakeSwap, TrustWallet, BscScan to improve the security control across the ecosystem.

@PancakeSwap: Auto-scans tokens & displays risk scores

@TrustWallet: Notifies users of high risks before transactions

@bscscan: Displays risk warnings in the explorer

New risks flagged in RedAlarm

A total of 319 dApps and 64 addresses were added to Hashdit's RedAlarm in August alone. This amounts to a total of 1679 smart contracts on RedAlarm currently.

Word of Advice

With the current trends in the BSC security landscape, Hashdit advices the community to:

Do Your Own Research (DYOR) before participating in any trending projects to mitigate the risk of financial losses, especially when the token name and symbol is an impersonation of the real token.
Place greater emphasis on security, adopt a Zero-Trust security mentality and be careful of phishing scams

Meanwhile, HashDit promises to continue to keep the BSC community and its users safe!

PancakeSwap August 31st Weekly Security Report

August 31, 2023 · 4 min read

Sebastian Lim

SCS@HashDit

Chris

SCS@HashDit

Disclaimer

Overview

High Risk TVL protocol on PCS

In this week, there were 252 newly identified risky addresses. Trending newly identified risky addresses:

Address	ContractName	Weekly Active Transactions
0xa68c9c2c39176b3ee9f6359b68e853893c6ddc5a	PIG9	4788
0x150cbd6e82d63db545ff8904de365b9154b0b386	DGTT	2370
0x2266362f414bf2476c5465dc2ea953fe2a99ae1c	Fake ZRO	2296
0xb1d4e33dd4aa6204bc8aae340b67455a662f038a	LNL	2262
0x3e573bf50b7625d9976fd65a8c0cdfbbc7b63a10	Multi-Cultural Connect (MCC)	2227
0x77087ab5df23cfb52449a188e80e9096201c2097	hi Dollar (HI)	1764
0x4908b8977f91e2257e5260551e7dc2950b1b3877	MARS (MARS)	1203
0xff71e87a2e7b818eee86f3f1c2e94a06cac85866	Cat	1085
0x9fbd6973f7e6e49eac8ff2eb857fdeed41d2e482	QUANTIC PROTOCOL (QUANTIC)	1055
0x7645444525bb2bd69ad23db57d3fc7b4fe3cda31	Bitcoin Dao (BTCD)	1028

Key themes on high risks:

Exactly half of the newly identified risky addresses (50%) were through threat intelligence. These addresses are either confirmed rugpulls (project has already removed rugged) or scam tokens that have high risk of rugs.
Red Alarm projects are manually identified by our security team for being potential scams. These are identified from a project level, for example projects that utilize fake social media marketing, or create scam meme projects. They are labeled under the DApps section of this page(17%)
Another theme for these contracts is that they have a privileged role, e.g owner is an EOA, which could mean some centralization risk as the owner can mint or toggle honeypot mode at will, so there could be rugpull risk. This portion represents 15% of the total newly identified risky addresses.

Refer to this link for the full list.

Tip: Filter by Top_TVL_Risky_Pool / Trending_Risky_Pool / Trending_Risky_Tokens to retrieve the risky addresses from different sources.

Integrations with PancakeSwap

Hashdit has partnered with PancakeSwap to integrate the DappBay’s Red Alarm. The risk score level reflects how risky the interacted token is, helping users make better informed decisions.

Example: Fake Circle Token - 0x84ef2e2e977062da3cfc12c038fa3ce2d42d01b1

The RedAlarm keyword will link to the risk scanner as seen in the image below.

Please take note that the risk level in Pancake & Risk Scanner might be different, because Hashdit use more conservative strategies for PancakeSwap than DappBay risk scanner.

Stay Safe!

About HashDit?

Ponzi Schemes in Web3 ---- Swamps in the Dark

August 28, 2023 · 14 min read

Chris

SCS@HashDit

Lukasz

SCS@HashDit

Ponzi Schemes in Web3 --- Swamps in the Dark

A guide on how to stay safe when interacting with DeFi projects

Disclaimer

The information provided through HashDit does not constitute advice or recommendations for investment or trading. HashDit is not responsible for any of your investment decisions. Please seek professional advice before taking financial risks.

What's a "ponzi"?

According to Wikipedia, the Ponzi scheme is a form of fraud that lures new investors and pays profits to earlier investors with funds from more recent investors. As you can imagine, if recent investors pay to earlier investors then... who pays the recent investors? The answer is, the even more recent investors. And if there are no more recent investors, then the latest ones remain with a loss, and the scheme collapses.

The ponzi scheme is often referred to as pyramid scheme, because to pay the "higher floor" investors with a profit, a larger, "lower floor" has to be created, like in the picture below.

https://sperrinlaw.net/financial-crime-fraud/ponzi-fraud/

Since the pyramid is not a real business, in terms of creating a product or a service and leveraging it to earn money on the market, in order to keep the funds flowing in, new investors have to be recruited and their "investment" is used to pay the old investors, who can then report significant returns on their investments. This creates an illusion of a profitable business, at least as long, as the current "lowest floor" manages to recruit new members.

If that's so obvious, then why people keep falling for it? Usually, the ponzi schemes are disguised as legitimate investments or projects. They will do everything to hide it's true nature so the new coming investors will believe they just met an investment of their lifetime. And when the scheme falls, it's already too late to run away.

Are there ponzi schemes in web3? If so, how to spot them? How not to lose money? Read on to learn more!

Ponzi schemes in Web3

Although Ponzi schemes originated in the traditional financial world, with the development of DeFi (Decentralized Finance), these fraudulent business models have also started to emerge in Web3. Web3 Ponzi schemes take advantage of the following features of DeFi, attracting investors through high returns and incentives.

Anonymity: The decentralized nature of DeFi allows Ponzi scheme operators to remain anonymous, making it difficult to trace and hold them accountable.
Utilizing smart contracts: A smart contract is a self-executing, self-enforcing protocol governed by its explicit terms and conditions. It stores and carries out contractual clauses via blockchain. These schemes use smart contracts to automate their operations, making them harder to detect while promising high returns on investments.
Tokenization: Some Ponzi schemes create their own tokens and use them for fundraising. They offer high rewards in the form of tokens, which may have little to no real value.
Limited regulation: The DeFi space has limited regulation, making it easier for Ponzi schemes to operate without being detected or shut down by financial authorities.
Low cost: Ponzi scheme projects can be fully autonomous and deployed at lower costs. They can even be continuously cloned.

So, how can one identify if a Web3 DeFi project is a Ponzi scheme or not?

Firstly, let's look at the project characteristics. Ponzi schemes usually have the following features:

Typical Web3 Ponzi schemes often employ aggressive marketing tactics, promising high and fixed short-term returns. For example, the official websites of such projects usually contain descriptions like "fixed daily profit". However, we know that fixed daily returns are unrealistic, and this is one of the biggest flaws in Ponzi schemes. In the cases we've accumulated, some Ponzi projects have even promised 25% daily interest rates!
High Referral Incentives: Ponzi schemes often combine with pyramid scheme marketing, aiming to attract more new investors and subsequent investment funds. Therefore, they often advertise a referral reward system on their official websites, sometimes even with multi-level referral rewards. Typical pyramid scheme descriptions include terms like "tiered referral rewards." The two images below are tiered referral reward system diagrams taken from Ponzi scheme websites:

These schemes usually disguise themselves as staking or mining projects to attract investors' principal investments and recruit new participants. However, in fact, they generally do not offer any real products or services but just promise an ability to make money. They often incorporate some popular trends, for example, AI or ChatGPT, promoting their projects as groundbreaking and innovative, as they need to attract more people and maintain an appearance of legitimacy.

Below are some additional features that can help investors determine whether a project is a Ponzi scheme. Please note that these traits are not exclusive to Ponzi scheme projects. Generally, the more of these a project has, the higher the risk:

No proper investments: The project appears to have no investments or partnerships, which means that the project lacks any business endorsements.
Opaque team information: The team behind the project remains anonymous to the public, making it easier for such projects to engage in malicious activities with lower costs.
Lack of documentation: There is a lack of documentation and whitepapers, as the project does not provide details about its internal operations and how it achieves these high returns. This is a potential red flag.
No external audit report: Projects with audit reports generally have a relatively smaller chance of encountering security issues. However, please note that having an audit report does not guarantee absolute security, as the audit report may only cover certain contracts and not examine the entire economic ecosystem of the project. The reliability of the audit report is also important, depending on the issuer and quality; well-known and reputable audit companies usually have greater credibility.

Decrypting a Ponzi project smart contract

Are you a more tech-savvy user? That's great. If you have some familiarity with Solidity code or want to learn it, we encourage you to go through the code snippets below to understand some of the characteristics of Ponzi scheme smart contracts.

As we mentioned earlier, Ponzi scheme Web3 projects generally don't have any real products, and therefore don't require many smart contracts. In their entire project ecosystem, there are usually only a few investment contracts that directly interact with users. At most, there might be an additional token contract, with the token often serving as a staking reward. However, this token typically won't be created on any decentralized exchange (DEX), meaning that holders of this token cannot swap it for other valuable tokens or stablecoins.

Next, we will delve into the characteristics of Ponzi investment smart contracts by using some code snippets as examples.

There is no method in the contract to withdraw the initial investment; it only allows for receiving dividends based on time
For example, in the below withdraw function, users cannot withdraw their principal investment; they can only withdraw dividends along with potential referral earnings.
This is also the difference between Ponzi schemes and regular mining/staking contracts.
Dividends are calculated based on a fixed daily returns ROI and time. For example, in the getUserDividends function below, the user's dividend is calculated by multiplying the fixed daily return rate for the user's deposit plan by the time elapsed. Typically, the daily return ROI is a hard-coded value or constant.

The code contains logic related to a Referral system. As we mentioned earlier, Ponzi investment smart contracts usually include a referral system, providing users with additional incentives for bringing new users into the scheme.
For example, in the contract below, there is a tiered referral reward mechanism, with first, second, and third-level referrers receiving referral rewards at a ratio of 9:2:1.
Of course, the referral rewards come from the principal investment of later investors. As can be seen, the invest function in the code distributes part of the user's investment amount to all referrers at their respective levels.

The project party generates revenue by charging tax fees on users' deposits. For example, in the code below, the project party charges a 5% dev fee on the user's principal, so they can profit as long as there are new users, regardless of how much money remains in the pool.

However, sometimes the project party does not directly impose a tax fee, claiming to have a 0% tax fee. In reality, the project party can become the initial referrer and continuously profit through the referral mechanism. This method of profiting is just more concealed.

Go further: A complete Ponzi example for more tech-savvy users

Let's go further! we created a sample ponzi scheme code based on what we're finding during our everyday work. We encourage you to study below simple smart contract code.

pragma solidity ^0.8.0;

contract PonziScheme {
    address public owner;
    mapping(address => uint) public investments;
    mapping(address => uint) public recruits;
    mapping(address => uint) public investmentTimestamp;

    constructor() {
        owner = msg.sender;
    }

    function recruitAndInvest(address referralAddress) public payable {
        require(msg.sender != referralAddress, "Cannot refer yourself");
        require(investments[msg.sender] == 0, "Already invested");
        require(msg.value == 0.1 ether, "Investment should be 0.1 Ether for recruitment bonus");
        // Add the recruit count for the referrer
        recruits[referralAddress]++;
        // Add the investment for the new investor with the bonus
        investments[msg.sender] = msg.value + 0.1 ether; // 0.1 ether bonus
        investmentTimestamp[msg.sender] = block.timestamp;
    }

    function calculateTotalReturn(address investor) public view returns(uint) {
        uint numberOfRecruits = recruits[investor];
        uint baseInvestment = investments[investor];
        uint profit = 0;
        if (numberOfRecruits >= 10) {
            profit = baseInvestment * 50 / 100; // 50% ROI
        } else if (numberOfRecruits >= 5) {
            profit = baseInvestment * 25 / 100; // 25% ROI
        }
        return baseInvestment + profit; // Total return = initial investment + profit
    }

    function cashOut() public {
        uint totalReturn = calculateTotalReturn(msg.sender);
        if (totalReturn == investments[msg.sender]) {
            require(block.timestamp >= investmentTimestamp[msg.sender] + 90 days, "Minimum 90 days required to withdraw without recruits");
        }
        require(address(this).balance >= totalReturn, "Insufficient funds in the contract");
        msg.sender.transfer(totalReturn);
        investments[msg.sender] = 0;
        recruits[msg.sender] = 0;
    }
}

Entry Point: The entry point for new investors is the recruitAndInvest() function. Here, a new investor specifies a referral address (the person who introduced them to the scheme) and sends 0.1 ether as their investment.
Incentive to Recruit: The incentive to recruit new members is twofold: Frist, the referrer gets a count increase in their recruits mapping, which will later increase their ROI. Second, the new investor gets a bonus of 0.1 ether added to their investment, effectively doubling their initial investment.
Ponzi Mechanics: The Ponzi nature of the scheme is visible in the calculateTotalReturn function. The ROI is determined by the number of recruits: 5-9 recruits: 25% ROI 10 or more recruits: 50% ROI The more people an investor recruits, the higher their promised return.
Potential Collapse: The scheme can collapse at some point. The ability to withdraw funds is implemented in the cashOut() function. If the contract doesn't have enough funds to pay out the total return (initial investment + profit), the cash out will fail. This will happen if not enough new investors are coming in to fund the returns for earlier investors. The require(address(this).balance >= totalReturn, "Insufficient funds in the contract"); line checks for this.
Safety Net (or Illusion of One): If an investor hasn't recruited at least 5 people, they can only withdraw their initial investment after 90 days. This might give the illusion of safety and legitimacy, but it's just a delay tactic. During the 90 days, the scheme might already rise and fall, and when the time for withdrawal comes, there might already be no funds on the contract.

Now you have a deeper understanding of the contract code for Ponzi schemes. However, in reality, some Ponzi smart contracts are even closed-source, making them opaque and more difficult to analyze and understand, thereby concealing the contract's logic and risks from users. When dealing with closed-source contracts, we should maintain an even higher level of vigilance and examine both the project and contract levels comprehensively to determine if they exhibit characteristics of a Ponzi scheme.

Identifying Ponzi schemes in a more simple way

In summary, before investing in Web3 DeFi projects, you need to conduct thorough due diligence to avoid mistakenly entering Ponzi schemes and incurring losses.

At the project level, conduct comprehensive research on the project team, token economy, and underlying technology. Be cautious of unrealistic high return promises, ensure that there is adequate transparency in the project, and verify that the project has a sound governance mechanism.

At the smart contract level, fully understand the source code and determine if there are any red flags in the code, always assessing risks before gaining a deeper understanding.

However, is this too complicated and difficult? After all, not all investors are technical experts. Don't worry, HashDit can help you.

For smart contracts, you can scan whether it is a Ponzi contract through https://dappbay.bnbchain.org/risk-scanner using the contract address. Dappbay's scanner is technically supported by HashDit, which has integrated various recognition rules for Ponzi schemes.

You can also search on the Dappbay website (https://dappbay.bnbchain.org/r) based on the Dapp's name, Twitter, website, etc., to see if the project has been marked as significant risk.

Additionally, you can follow HashDit's X (https://twitter.com/HashDit). HashDit continuously monitors data on the BNB chain and provides ongoing alerts for BNB chain-related risks.

Remember, never invest blindly in the dark forest of Web3. HashDit will guide you around every "swamp" and protect your Web3 journey!

Appendix

Below are some Ponzi scam Web3 projects that HashDit has identified in the past. Please stay alert! At the same time, you can also use these projects as reference materials to conduct your own research!

(Scroll right on the form below for more information)

Chain_id	Address	Website	Project Name	Risk Reason Remark
56	0x3f3f162e8F172fB681a4Fe9BE187B0FF21fE0734	avaricetoken.io	Avarice	Ponzi Scam Project
56		bnbdaily.finance	BNB Daily Finance	Ponzi project - Offers unsustainable rates of "DAILY ROI 0.7%". Lack of investments, product, documentation. Opaque team.
56	0x3471Cc34ED5d7ceadd0a533dedA18ecC0d6Bd927	cashbox.cfd	Cashbox Investment Pool	High APR/APY. Lack of investments, product, documentation. Opaque team.
56		finx.global	FinSwap	High APR/APY. Centralization in top holders.
56		busdyield.com	BUSDYield	Ponzi SCAM Project
56		twitter.com/x_roi_community	TrueFund	Ponzi scam Project
56		bnbcrush.io	BNB Crush	Ponzi scam Project
56		ai-trader.app	AI Trader	Ponzi scam Project
56		chronostake.com	ChronoStake	Ponzi scam Project
56		rewardscapital.app	Reward Capital	Ponzi SCAM Project
56		sharkbnb.cloud	Shark BNB	Ponzi SCAM Project
56	0x00000065cBADeAD116136940b302F938284f2BDc	poop.fi	Poop	Ponzi SCAM Project
56	0xa06411Af90C84fa9Ba4168CC08D8618A602826ba	staker.cafe	Staker Cafe	Ponzi SCAM Project
56		matrixpro.vip	Matrix Pro	Ponzi SCAM Project
56	0x80B48C38Ced124eA15a2c19684877ccE4Ab2D524	lamon.app	Lamon App	Ponzi SCAM Project
56		fin-toch.com	FTC	Ponzi SCAM Project
56	0xca7Ea9003a9cA60c2adC054a379035723A7a9F49	kingdomlegacy.io	Kingdom Legacy	Ponzi SCAM Project
56	0xd96099403F4b47C3046A6Da11d8cAf254D806398	towers.pizza	Pizza Tower	Ponzi SCAM Project
56	0xd6f5ea3db32dbdc3e9866e60459788de8a2106c7	tripfoundation.io	Trip Foundation	Ponzi SCAM Project
56	0x40755D50d6Af0B5955a7491D6A5DA94535c26382	snyperfund.com	Snyper Fund	Ponzi SCAM Project
56	0xaef10dd120e79f60d61048c306b7379c21d56a38	bakedpizza.app	Baked Pizza	Ponzi SCAM Project
56	0x7785035610075Ec7BcD7c833B03996E866FE0072	blockrewards.pro	Block Rewards	Ponzi SCAM Project

PancakeSwap August 24th Weekly Security Report

August 24, 2023 · 23 min read

Sebastian Lim

SCS@HashDit

Chris

SCS@HashDit

Disclaimer

Overview

Stay Safe!

About HashDit?

High Risk Subjects this week

WAT stands for Weekly Active Transactions

Top TVL Pools

Address	ContractName	WAT	Risk_Level	Risk_Description
0xba509bdb71a29301860800e13867b59b461747af	MonSpaC (MSPC)	63588	5	The address is blacklisted based on threat intelligence or manual analysis.;The contract contains some backdoor function which always means the owner has some potentially malicious intent, please be careful of rugpull risk.;The contract contains some privileged role function which always means some centralization risk, please be careful of rugpull risk.
0xabe776435f7459e2f5ba773bfb753ed19a053dd0	token	6669	5	The address is blacklisted based on threat intelligence or manual analysis.
0x066aee69d93dee28b32a57febd1878a2d94f6b0c	GGoose NFT: gold8 Token Ponzi	5089	5	The address is blacklisted based on threat intelligence or manual analysis.
0x83d3c2d1a55687498df6800c5f173ec6a7556089	BEATS	2371	5	The address is blacklisted based on threat intelligence or manual analysis.
0x4c3145cb6285eb269c37685e05ff8c6684a70ec7	FTC (FTC)	412	5	The address is blacklisted based on threat intelligence or manual analysis.
0x9e9bef94795bfe87a11a0369b4e0c3b60a6fcf2b	MBankToken	372	5	The address is blacklisted based on threat intelligence or manual analysis.
0x6e9f02f933575cc5f7938fc55ed304f3435d3508	MONO	306	5	The address is blacklisted based on threat intelligence or manual analysis.
0x378b7a04c7cc71556319cd031cd56b1f986e2024		154	5	The contract contains some backdoor function which could mean the owner has some potentially malicious intent, please be careful of rugpull risk.;The contract contains some privileged role function which always means some centralization risk, please be careful of rugpull risk.;The contract has some scam features such as Ponzi, Honeypot or fake token, please be careful of scam risk.
0xb12e8eb6b1f24e14381514d2f3b75e7c61487016	GSD (GSD)	c	5	The contract contains some backdoor function which always means the owner has some potentially malicious intent, please be careful of rugpull risk.;The contract contains some privileged role function which always means some centralization risk, please be careful of rugpull risk.;The contract has some scam features such as Ponzi, Honeypot or fake token, please be careful of scam risk.
0x29c55f1b02a95f0b30e61976835a3eee2359ad92	EShareV2	76	5	The address is related to a coin mixer platform such as Tornado.Cash, which could mean some potential risks, please be careful of scam risk.;The contract contains some backdoor function which always means the owner has some potentially malicious intent, please be careful of rugpull risk.;The contract has some scam features such as Ponzi, Honeypot or fake token, please be careful of scam risk.
0x0f9adaaccd7caecc5019194e15ad19624fed95fa	ThankYou	68	5	The address is blacklisted based on threat intelligence or manual analysis.
0x000000000482aa9817645c3d56aa2230f6573532	GPTChat (GPTC) - Fake_Phishing685	55	5	The address is blacklisted based on threat intelligence or manual analysis.
0xa03110800894b3ccf8723d991d80875561f96777	BIT GAME VERSE TOKEN	44	5	The address is blacklisted based on threat intelligence or manual analysis.
0xb1a1d06d42a43a8fcfdc7fdcd744f7ef03e8ad1a	HongKongDAO (HKD)	42	5	The address is blacklisted based on threat intelligence or manual analysis.
0x8f2775e4be08055c7dd4ebf654628b183106a8e1	Token	30	5	The address is blacklisted based on threat intelligence or manual analysis.
0x502435713854f5e92d048d27de95c9ce16dc380d	(null)	27	5	The address is blacklisted based on threat intelligence or manual analysis.
0xd024ac1195762f6f13f8cfdf3cdd2c97b33b248b	CoinToken	26	5	The address is blacklisted based on threat intelligence or manual analysis.
0x8d7674523d2ccd1d631aa1f456b319ff849dc16c	Token	22	5	The address is blacklisted based on threat intelligence or manual analysis.
0x90a1e4bbade88366dc44436535f1571d95e666c7	TransparentUpgradeableProxy	14	5	The address is blacklisted based on threat intelligence or manual analysis.
0x4d50e3f89bbc63d199e1bbbd04cd15bf2382592b	RabbitKing	12	5	The address is blacklisted based on threat intelligence or manual analysis.;The contract contains some backdoor function which could mean the owner has some potentially malicious intent, please be careful of rugpull risk.;The contract contains some privileged role function which always means some centralization risk, please be careful of rugpull risk.;The contract has some scam features such as Ponzi, Honeypot or fake token, please be careful of scam risk.
0xd60f15dffd3296871fcdf9e3a074e225648ae242	Token	9	5	The address is blacklisted based on threat intelligence or manual analysis.
0xae493c72224c77d85032b534a44a117cbca8df06	Token	8	5	The address is blacklisted based on threat intelligence or manual analysis.
0xf38d89f9ace1934d155c7a5b2c41a729b7702a09	Token	7	5	The address is blacklisted based on threat intelligence or manual analysis.
0x95173a846cf2134ce5d1dc86bdfb46aa8e41f697	BITCOIN	6	5	The address is blacklisted based on threat intelligence or manual analysis.
0xb695806cc5a3cd8623b92bbd221e3bec6e8e3bed	Neutrinos ($NEUTR)	5	5	The address is blacklisted based on threat intelligence or manual analysis.
0x33714356e2a3e216d055440eb24d0e23458b1b85	SafeZone	3	5	The address is related to a coin mixer platform such as Tornado.Cash, which could mean some potential risks, please be careful of scam risk.;The contract contains some backdoor function which always means the owner has some potentially malicious intent, please be careful of rugpull risk.;The contract contains some privilegedprivileged role function which always means some centralization risk, please be careful of rugpull risk.
0x0b1ff525e092a98210ed150f8b08313f646847d6	BabyMUSK	3	5	The address is related to a coin mixer platform such as Tornado.Cash, which could mean some potential risks, please be careful of scam risk.;The contract contains some backdoor function which could mean the owner has some potentially malicious intent, please be careful of rugpull risk.;The contract contains some privileged role function which always means some centralization risk, please be careful of rugpull risk.
0xc45b64cd6643a18f62a5420ddc85bff128625176	Arkham (ARKM)	2	5	The address is blacklisted based on threat intelligence or manual analysis.
0xf17f7827403c166fda782ceb17b29900d1a2ad15	Elron	2	5	The address is blacklisted based on threat intelligence or manual analysis.
0x231b69254d48de6e96c395100b3d9bce8d658e49	PATEX	1	5	The address is blacklisted based on threat intelligence or manual analysis.
0x0c7fc02c7417bcf147a70fac98f0390f82c0ca2b	Token	1	5	The address is blacklisted based on threat intelligence or manual analysis.
0xa1cda647f6d07d94ea0be2c83b9f312b977ecbc4	SafeBeesQueen	1	5	The address is blacklisted based on threat intelligence or manual analysis.;The address is related to a coin mixer platform such as Tornado.Cash, which could mean some potential risks, please be careful of scam risk.;The contract contains some backdoor function which always means the owner has some potentially malicious intent, please be careful of rugpull risk.;The contract contains some privileged role function which always means some centralization risk, please be careful of rugpull risk.
0x10f292a6e694c38c5d570127da445143a2d882f3	Cocktail	1	5	The address is related to a coin mixer platform such as Tornado.Cash, which could mean some potential risks, please be careful of scam risk.;The contract contains some backdoor function which could mean the owner has some potentially malicious intent, please be careful of rugpull risk.;The contract contains some privileged role function which always means some centralization risk, please be careful of rugpull risk.
0xced59c3249f20ca36fba764bfdd9d94f471b3154	WettokMarket	1	5	The address is blacklisted based on threat intelligence or manual analysis.
0xbdbd5a8179c9ba78327a50a8c0454c6f93bc4ce2	APPLE	1	5	The contract contains some backdoor function which always means the owner has some potentially malicious intent, please be careful of rugpull risk.;The contract contains some privileged role function which always means some centralization risk, please be careful of rugpull risk.;The contract has some scam features such as Ponzi, Honeypot or fake token, please be careful of scam risk.
0xf8d90d089e5a422183d3a368251b2f88e634bd92	Token	0	5	The address is blacklisted based on threat intelligence or manual analysis.
0x425e2ef5e72a85a676ccb022ef96979d64bb5be2	Token	0	5	The address is blacklisted based on threat intelligence or manual analysis.
0x1d48fcc64a8005bd83d41af50284029cd2331a14	Token	0	5	The address is blacklisted based on threat intelligence or manual analysis.
0x7918f0ba2d3ff06dec4b8fa7079df01c8a0d68f8	Token	0	5	The address is blacklisted based on threat intelligence or manual analysis.
0xe0796f447d28d99ec893721e32f84ad1bf9f60da	(空字符串)	0	5	The address is blacklisted based on threat intelligence or manual analysis.
0x65a7ab3332e110128283bec3c926e940a9e2a860	Token	0	5	The address is blacklisted based on threat intelligence or manual analysis.
0xeb6b00f8c7e1da78fb919c810c30dde95475bdde	MINERS	0	5	The address is related to a coin mixer platform such as Tornado.Cash, which could mean some potential risks, please be careful of scam risk.;The contract contains some backdoor function which always means the owner has some potentially malicious intent, please be careful of rugpull risk.;The contract contains some privileged role function which always means some centralization risk, please be careful of rugpull risk.
0x079c84ce97c72c79e7402d4383c6b2d25e51a426	BEP20XAI	0	5	The address is blacklisted based on threat intelligence or manual analysis.
0x6df52fc4c234600d2d1f064c33be762146964bb1	SATORI	0	5	The address is blacklisted based on threat intelligence or manual analysis.
0xbdfed84a3c0735a01abc74aad54e66cd50a60b74	Token	0	5	The address is blacklisted based on threat intelligence or manual analysis.
0x64b5d3f6fd5fbc4f2832c8c42315d5fdd6bc8bd2	Token	0	5	The address is blacklisted based on threat intelligence or manual analysis.
0x2ffc49e7331ceb6a6831336cca3a85899fb68d40	Token	0	5	The address is blacklisted based on threat intelligence or manual analysis.
0x23d7127a3f674c7bdeaa4afa3662769b13540d2f	Token	0	5	The address is blacklisted based on threat intelligence or manual analysis.
0xc24796458fbea043780eea59ebba4ad40e87c29b	Salary	0	5	The address is blacklisted based on threat intelligence or manual analysis.;The contract contains some backdoor function which always means the owner has some potentially malicious intent, please be careful of rugpull risk.;The contract contains some privileged role function which always means some centralization risk, please be careful of rugpull risk.;The contract has some scam features such as Ponzi, Honeypot or fake token, please be careful of scam risk.
0xac7ae2eca9aa162590f884efd36f29056953b49f	MD	0	5	The contract contains some backdoor function which always means the owner has some potentially malicious intent, please be careful of rugpull risk.;The contract contains some privileged role function which always means some centralization risk, please be careful of rugpull risk.;The contract has some scam features such as Ponzi, Honeypot or fake token, please be careful of scam risk.
0xdf7ff95aa3d855a6fb21399432166a92fdcf1b1a	BEP20USEA	0	5	The address is blacklisted based on threat intelligence or manual analysis.

Address	ContractName	WAT	Risk_Level	Risk_Description
0x04f46cdfe8dd348e41902eef1aff19ace1661f4c	FTC (FTC)	33728	4	The address is blacklisted based on threat intelligence or manual analysis.
0x4d1e90ab966ae26c778b2f9f365aa40abb13f53c	STA	15574	4	The address is blacklisted based on threat intelligence or manual analysis.
0xba509bdb71a29301860800e13867b59b461747af	MonSpaC (MSPC)	12306	5	The address is blacklisted based on threat intelligence or manual analysis.;The contract contains some backdoor function which always means the owner has some potentially malicious intent, please be careful of rugpull risk.;The contract contains some privileged role function which always means some centralization risk, please be careful of rugpull risk.
0xc9882def23bc42d53895b8361d0b1edc7570bc6a	FistStandard	10792	4	The address is blacklisted based on threat intelligence or manual analysis.
0x1f1c90aeb2fd13ea972f0a71e35c0753848e3db0	TransparentUpgradeableProxy	4038	4	The address is blacklisted based on threat intelligence or manual analysis.
0xabe776435f7459e2f5ba773bfb753ed19a053dd0	token	3911	5	The address is blacklisted based on threat intelligence or manual analysis.
0x4d7fa587ec8e50bd0e9cd837cb4da796f47218a1	SAFE(AnWang) (SAFE)	2002	4	The contract contains some backdoor function which always means the owner has some potentially malicious intent, please be careful of rugpull risk.
0x83d3c2d1a55687498df6800c5f173ec6a7556089	BEATS	1873	5	The address is blacklisted based on threat intelligence or manual analysis.
0x78997aa5d48efe1c96415e0d941ba687cdc1c358	MC	1517	4	The address is blacklisted based on threat intelligence or manual analysis.
0x1a97b0cf1efb5228027dd782ed5d82c901694042	CCToken	896	4	The contract contains some privileged role function which always means some centralization risk, please be careful of rugpull risk.;The contract has some scam features such as Ponzi, Honeypot or fake token, please be careful of scam risk.
0x1e83d06e17cae34415bea30116ac755456131020	Token	702	4	The contract contains some backdoor function which always means the owner has some potentially malicious intent, please be careful of rugpull risk.
0xd983ab71a284d6371908420d8ac6407ca943f810	Ultron Foundation: ULX Token	629	4	The address is blacklisted based on threat intelligence or manual analysis.
0xff71e87a2e7b818eee86f3f1c2e94a06cac85866	Cat	585	4	The address is blacklisted based on threat intelligence or manual analysis.;The contract contains some backdoor function which could mean the owner has some potentially malicious intent, please be careful of rugpull risk.;The contract contains some privileged role function which always means some centralization risk, please be careful of rugpull risk.
0x051e0ac843bae1c83f2d3d44237c8eec33560b55	NULL	581	4	The contract is unverified which always indicates some potential risks, please be careful of scam or hack risk.
0x73fbd93bfda83b111ddc092aa3a4ca77fd30d380	SophiaVerseToken	503	4	The address is blacklisted based on threat intelligence or manual analysis.
0xc017d283bde7c6ec521dace9ddea1ebf90ed6f78	MRKCoin	482	4	The contract contains some backdoor function which could mean the owner has some potentially malicious intent, please be careful of rugpull risk.
0x9767c8e438aa18f550208e6d1fdf5f43541cc2c8	MangoMan Intelligent	441	4	The address is blacklisted based on threat intelligence or manual analysis.
0x11ac6af070fe1991a457c56fb85c577efe57f0e4	DragonKing (DragonKing)	440	4	The address is blacklisted based on threat intelligence or manual analysis.;The contract contains some backdoor function which could mean the owner has some potentially malicious intent, please be careful of rugpull risk.
0x5b6bf0c7f989de824677cfbd507d9635965e9cd3	Gamium: GMM Token	432	4	The address is blacklisted based on threat intelligence or manual analysis.
0x43f5b64b3d1a9275b460480430a027424aa17f8c	Token	386	4	The contract contains some backdoor function which could mean the owner has some potentially malicious intent, please be careful of rugpull risk.
0xc632f90affec7121120275610bf17df9963f181c	DEBT	374	4	The address is blacklisted based on threat intelligence or manual analysis.
0xd7791c6860a315c2ad9fcb13149f408f58f529fe	CCToken	360	4	The address is blacklisted based on threat intelligence or manual analysis.;The contract contains some privileged role function which always means some centralization risk, please be careful of rugpull risk.;The contract has some scam features such as Ponzi, Honeypot or fake token, please be careful of scam risk.
0xa4838122c683f732289805fc3c207febd55babdd	Trias: TRIAS Token	332	4	The address is blacklisted based on threat intelligence or manual analysis.
0x43b44d4b278c43c4d3251374337e1c6aa10fa76f	XCATTOKEN	307	4	The contract contains some backdoor function which could mean the owner has some potentially malicious intent, please be careful of rugpull risk.
0x4b383b52882a779817e1312894bf3f1466c660e9	XProBotTOKEN	307	4	The contract contains some backdoor function which could mean the owner has some potentially malicious intent, please be careful of rugpull risk.
0x5b415df00a5276a6baf8434d1432058a62759ef1	ONPAYTOKEN	291	4	The contract contains some backdoor function which could mean the owner has some potentially malicious intent, please be careful of rugpull risk.
0x668a81d1ee8e9db76e14237366362d3c4878883a	WWDTOKEN	286	4	The contract contains some backdoor function which could mean the owner has some potentially malicious intent, please be careful of rugpull risk.
0x7c0e5ad65c6083f53efa1d4d0844efca34f19e2a	ERCXTOKEN	283	4	The contract contains some backdoor function which could mean the owner has some potentially malicious intent, please be careful of rugpull risk.
0x77087ab5df23cfb52449a188e80e9096201c2097	hiDollar	275	4	The address is blacklisted based on threat intelligence or manual analysis.;The contract contains some privileged role function which always means some centralization risk, please be careful of rugpull risk.
0xc89c57e38dcaba62501d53e5ea490945d1d8f346	SeiCloudTOKEN	268	4	The contract contains some backdoor function which could mean the owner has some potentially malicious intent, please be careful of rugpull risk.
0x571e522dc7c5a75ee5f432ff9abaceb2d88d0abc	DJOTOKEN	267	4	The contract contains some backdoor function which could mean the owner has some potentially malicious intent, please be careful of rugpull risk.
0x6d6ba21e4c4b29ca7bfa1c344ba1e35b8dae7205	KatanaInu: KATA Token	260	4	The address is blacklisted based on threat intelligence or manual analysis.
0xc7cba05f673cfab408a9fb0ef5fcc3c25a4abeba	TradeXAI	252	4	The contract contains some backdoor function which could mean the owner has some potentially malicious intent, please be careful of rugpull risk.
0x16760310e7b83d6aac3d82ad56da3ca42fda13d8	TOKEN	250	5	The address is blacklisted based on threat intelligence or manual analysis.
0x6428177a36be2202f7cee6757498959ab9818efb	TRUMPXTOKEN	246	4	The contract contains some backdoor function which could mean the owner has some potentially malicious intent, please be careful of rugpull risk.
0x05f6499cc6a62b6e2c88ad3db7376fde040c0f2d	LEGOTOKEN	246	4	The contract contains some backdoor function which could mean the owner has some potentially malicious intent, please be careful of rugpull risk.;The contract has some scam features such as Ponzi, Honeypot or fake token, please be careful of scam risk.
0xb2393c1afc7a3cea1f69be5e516b9697fa5fbbba	MOTNTOKEN	237	4	The contract contains some backdoor function which could mean the owner has some potentially malicious intent, please be careful of rugpull risk.
0xa203711c7ead07a33a7a6e2f4abb6fff47229458	POOTOKEN	235	4	The contract contains some backdoor function which could mean the owner has some potentially malicious intent, please be careful of rugpull risk.
0x4607618b57f0edc42c42810e3c245b49ad7338a7	ShikokuTOKEN	218	4	The contract contains some backdoor function which could mean the owner has some potentially malicious intent, please be careful of rugpull risk.
0x53cf15f77f2b11ef655dccbce6699c3086eae064	ETHEREUMTOKEN	187	4	The contract contains some backdoor function which could mean the owner has some potentially malicious intent, please be careful of rugpull risk.
0xbb38109575a98c8697cbc10f8836d8a9af7c9244	APEBOTTOKEN	174	4	The contract contains some backdoor function which could mean the owner has some potentially malicious intent, please be careful of rugpull risk.
0xc001bbe2b87079294c63ece98bdd0a88d761434e	EverGrow: EGC Token	159	4	The address is blacklisted based on threat intelligence or manual analysis.;The contract contains some privileged role function which always means some centralization risk, please be careful of rugpull risk.
0xdb9e84cf5affca6676a5705b667e887ccdf64e8f	KBLETOKEN	148	4	The contract contains some backdoor function which could mean the owner has some potentially malicious intent, please be careful of rugpull risk.
0x641d187b77f5c64b5b663bf32157661218c49740	NULL	102	4	The contract is unverified which always indicates some potential risks, please be careful of scam or hack risk.
0x18a03d80a74c669834227433703dc25ccadbcb37	BABYTOKEN	101	4	The contract contains some backdoor function which could mean the owner has some potentially malicious intent, please be careful of rugpull risk.;The contract contains some privileged role function which always means some centralization risk, please be careful of rugpull risk.
0xe758b7856756fa0e5d21be5412dfff8c317cc678	BLOCX	55	4	The contract has some scam features such as Ponzi, Honeypot or fake token, please be careful of scam risk.
0x31342a89fb2d7856aaa32247f6b4e28b871d8e1a	UST	36	4	The address is related to a coin mixer platform such as Tornado.Cash, which could mean some potential risks, please be careful of scam risk.;The contract has some scam features such as Ponzi, Honeypot or fake token, please be careful of scam risk.
0x808f1350dff684c099f4837a01d863fc61a86bc6	MFI_ERC20	22	4	The contract contains some backdoor function which could mean the owner has some potentially malicious intent, please be careful of rugpull risk.
0xe30400ad998f611168087c74b8969b5eda92830c	PANDA	19	4	The address is blacklisted based on threat intelligence or manual analysis.
0x8d2a0757e4b39b9440c21984fb9ae54cdb6ecd75	CCA	4	4	The contract has some scam features such as Ponzi, Honeypot or fake token, please be careful of scam risk.

Address	ContractName	WAT	Risk_Level	Risk_Description
0xba509bdb71a29301860800e13867b59b461747af	MonSpaC (MSPC)	63588	5	The address is blacklisted based on threat intelligence or manual analysis.;The contract contains some backdoor function which could mean the owner has some potentially malicious intent, please be careful of rugpull risk.;The contract contains some privileged role function which always means some centralization risk, please be careful of rugpull risk.
0x4238e5ccc619dcc8c00ade4cfc5d3d9020b24898	AIT	37062	4	The address is blacklisted based on threat intelligence or manual analysis.
0x4d1e90ab966ae26c778b2f9f365aa40abb13f53c	STA	50602	4	The address is blacklisted based on threat intelligence or manual analysis.
0x75ca521892de7f2ecfb070cab545c250d0ceb7e3	PVCMETA	17619	4	The address is blacklisted based on threat intelligence or manual analysis.
0xba509bdb71a29301860800e13867b59b461747af	MonSpaC (MSPC)	63588	5	The address is blacklisted based on threat intelligence or manual analysis.;The contract contains some backdoor function which could mean the owner has some potentially malicious intent, please be careful of rugpull risk.;The contract contains some privileged role function which always means some centralization risk, please be careful of rugpull risk.
0xc9882def23bc42d53895b8361d0b1edc7570bc6a	FistStandard	19186	4	The address is blacklisted based on threat intelligence or manual analysis.
0x20f663cea80face82acdfa3aae6862d246ce0333	Drip Network	8565	4	The address is blacklisted based on threat intelligence or manual analysis.
0x1f1c90aeb2fd13ea972f0a71e35c0753848e3db0	TransparentUpgradeableProxy	7669	4	The address is blacklisted based on threat intelligence or manual analysis.
0xabe776435f7459e2f5ba773bfb753ed19a053dd0	token	6669	5	The address is blacklisted based on threat intelligence or manual analysis.
0x11a1764c877837921eca6f3f58cdbe9bcd4e9e5e	BTCASH (METABT)	4260	5	The address is blacklisted based on threat intelligence or manual analysis.
0x4908b8977f91e2257e5260551e7dc2950b1b3877	Mars	3175	4	The contract contains some backdoor function which could mean the owner has some potentially malicious intent, please be careful of rugpull risk.;The contract contains some privileged role function which always means some centralization risk, please be careful of rugpull risk.;The contract has some scam features such as Ponzi, Honeypot or fake token, please be careful of scam risk.
0x93023f1d3525e273f291b6f76d2f5027a39bf302	AMGToken	2481	4	The address is blacklisted based on threat intelligence or manual analysis.;The contract contains some privileged role function which always means some centralization risk, please be careful of rugpull risk.;The contract has some scam features such as Ponzi, Honeypot or fake token, please be careful of scam risk.
0x4d7fa587ec8e50bd0e9cd837cb4da796f47218a1	SAFE(AnWang) (SAFE)	8430	4	The contract contains some backdoor function which could mean the owner has some potentially malicious intent, please be careful of rugpull risk.
0x83d3c2d1a55687498df6800c5f173ec6a7556089	BEATS	2371	5	The address is blacklisted based on threat intelligence or manual analysis.
0x78997aa5d48efe1c96415e0d941ba687cdc1c358	MC	2622	4	The address is blacklisted based on threat intelligence or manual analysis.
0x1a97b0cf1efb5228027dd782ed5d82c901694042	CCToken	1053	4	The contract contains some privileged role function which always means some centralization risk, please be careful of rugpull risk.;The contract has some scam features such as Ponzi, Honeypot or fake token, please be careful of scam risk.
0x198271b868dae875bfea6e6e4045cdda5d6b9829	DogsTokenV2	1226	4	The address is blacklisted based on threat intelligence or manual analysis.;The contract contains some privileged role function which always means some centralization risk, please be careful of rugpull risk.
0x1e83d06e17cae34415bea30116ac755456131020	Token	813	4	The contract contains some backdoor function which could mean the owner has some potentially malicious intent, please be careful of rugpull risk.
0xd983ab71a284d6371908420d8ac6407ca943f810	Ultron Foundation: ULX Token	1819	4	The address is blacklisted based on threat intelligence or manual analysis.
0xff71e87a2e7b818eee86f3f1c2e94a06cac85866	Cat	733	4	The address is blacklisted based on threat intelligence or manual analysis.;The contract contains some backdoor function which could mean the owner has some potentially malicious intent, please be careful of rugpull risk.;The contract contains some privileged role function which always means some centralization risk, please be careful of rugpull risk.
0x051e0ac843bae1c83f2d3d44237c8eec33560b55	NULL	748	4	The contract is unverified which always indicates some potential risks, please be careful of scam or hack risk.
0x73fbd93bfda83b111ddc092aa3a4ca77fd30d380	SophiaVerseToken	746	4	The address is blacklisted based on threat intelligence or manual analysis.
0xc017d283bde7c6ec521dace9ddea1ebf90ed6f78	MRKCoin	575	4	The contract contains some backdoor function which could mean the owner has some potentially malicious intent, please be careful of rugpull risk.
0x9767c8e438aa18f550208e6d1fdf5f43541cc2c8	MangoMan Intelligent	585	4	The address is blacklisted based on threat intelligence or manual analysis.
0x11ac6af070fe1991a457c56fb85c577efe57f0e4	DragonKing (DragonKing)	559	4	The address is blacklisted based on threat intelligence or manual analysis.;The contract contains some backdoor function which could mean the owner has some potentially malicious intent, please be careful of rugpull risk.
0xc632f90affec7121120275610bf17df9963f181c	DEBT	485	4	The address is blacklisted based on threat intelligence or manual analysis.
0x83f41c98d028842ccc8060b4ec7738df3eb9a2e6	BWJ	482	4	The contract contains some backdoor function which could mean the owner has some potentially malicious intent, please be careful of rugpull risk.
0x6d6ba21e4c4b29ca7bfa1c344ba1e35b8dae7205	KatanaInu: KATA Token	407	4	The address is blacklisted based on threat intelligence or manual analysis.
0x9e9bef94795bfe87a11a0369b4e0c3b60a6fcf2b	MBankToken	372	5	The address is blacklisted based on threat intelligence or manual analysis.
0x4b383b52882a779817e1312894bf3f1466c660e9	XProBotTOKEN	335	4	The contract contains some backdoor function which could mean the owner has some potentially malicious intent, please be careful of rugpull risk.
0x808f1350dff684c099f4837a01d863fc61a86bc6	MFI_ERC20	334	4	The contract contains some backdoor function which could mean the owner has some potentially malicious intent, please be careful of rugpull risk.
0xc7cba05f673cfab408a9fb0ef5fcc3c25a4abeba	TradeXAI	326	4	The contract contains some backdoor function which could mean the owner has some potentially malicious intent, please be careful of rugpull risk.
0x43b44d4b278c43c4d3251374337e1c6aa10fa76f	XCATTOKEN	325	4	The contract contains some backdoor function which could mean the owner has some potentially malicious intent, please be careful of rugpull risk.
0x16760310e7b83d6aac3d82ad56da3ca42fda13d8	TOKEN	310	5	The address is blacklisted based on threat intelligence or manual analysis.
0x5b415df00a5276a6baf8434d1432058a62759ef1	ONPAYTOKEN	307	4	The contract contains some backdoor function which could mean the owner has some potentially malicious intent, please be careful of rugpull risk.
0x7c0e5ad65c6083f53efa1d4d0844efca34f19e2a	ERCXTOKEN	306	4	The contract contains some backdoor function which could mean the owner has some potentially malicious intent, please be careful of rugpull risk.
0x668a81d1ee8e9db76e14237366362d3c4878883a	WWDTOKEN	305	4	The contract contains some backdoor function which could mean the owner has some potentially malicious intent, please be careful of rugpull risk.
0x9a3321e1acd3b9f6debee5e042dd2411a1742002	PIGS Token (AFP)	293	4	The address is blacklisted based on threat intelligence or manual analysis.;The contract contains some privileged role function which always means some centralization risk, please be careful of rugpull risk.
0x571e522dc7c5a75ee5f432ff9abaceb2d88d0abc	DJOTOKEN	284	4	The contract contains some backdoor function which could mean the owner has some potentially malicious intent, please be careful of rugpull risk.
0xc89c57e38dcaba62501d53e5ea490945d1d8f346	SeiCloudTOKEN	279	4	The contract contains some backdoor function which could mean the owner has some potentially malicious intent, please be careful of rugpull risk.
0x05f6499cc6a62b6e2c88ad3db7376fde040c0f2d	LEGOTOKEN	267	4	The contract contains some backdoor function which could mean the owner has some potentially malicious intent, please be careful of rugpull risk.;The contract has some scam features such as Ponzi, Honeypot or fake token, please be careful of scam risk.
0x6428177a36be2202f7cee6757498959ab9818efb	TRUMPXTOKEN	264	4	The contract contains some backdoor function which could mean the owner has some potentially malicious intent, please be careful of rugpull risk.
0xb2393c1afc7a3cea1f69be5e516b9697fa5fbbba	MOTNTOKEN	256	4	The contract contains some backdoor function which could mean the owner has some potentially malicious intent, please be careful of rugpull risk.
0xa203711c7ead07a33a7a6e2f4abb6fff47229458	POOTOKEN	243	4	The contract contains some backdoor function which could mean the owner has some potentially malicious intent, please be careful of rugpull risk.
0x641d187b77f5c64b5b663bf32157661218c49740	NULL	238	4	The contract is unverified which always indicates some potential risks, please be careful of scam or hack risk.
0x4607618b57f0edc42c42810e3c245b49ad7338a7	ShikokuTOKEN	231	4	The contract contains some backdoor function which could mean the owner has some potentially malicious intent, please be careful of rugpull risk.
0x9fb9a33956351cf4fa040f65a13b835a3c8764e3	AnyswapV5ERC20	229	4	The address is blacklisted based on threat intelligence or manual analysis.
0xc001bbe2b87079294c63ece98bdd0a88d761434e	EverGrow: EGC Token	202	4	The address is blacklisted based on threat intelligence or manual analysis.;The contract contains some privileged role function which always means some centralization risk, please be careful of rugpull risk.
0x53cf15f77f2b11ef655dccbce6699c3086eae064	ETHEREUMTOKEN	202	4	The contract contains some backdoor function which could mean the owner has some potentially malicious intent, please be careful of rugpull risk.
0xbb38109575a98c8697cbc10f8836d8a9af7c9244	APEBOTTOKEN	184	4	The contract contains some backdoor function which could mean the owner has some potentially malicious intent, please be careful of rugpull risk.
0xdb9e84cf5affca6676a5705b667e887ccdf64e8f	KBLETOKEN	164	4	The contract contains some backdoor function which could mean the owner has some potentially malicious intent, please be careful of rugpull risk.
0xe758b7856756fa0e5d21be5412dfff8c317cc678	BLOCX	151	4	The contract has some scam features such as Ponzi, Honeypot or fake token, please be careful of scam risk.
0x31342a89fb2d7856aaa32247f6b4e28b871d8e1a	UST	49	4	The address is related to a coin mixer platform such as Tornado.Cash, which could mean some potential risks, please be careful of scam risk.;The contract has some scam features such as Ponzi, Honeypot or fake token, please be careful of scam risk.
0x8d2a0757e4b39b9440c21984fb9ae54cdb6ecd75	CCA	4	4	The contract has some scam features such as Ponzi, Honeypot or fake token, please be careful of scam risk.

2023 H1 BSC Security Report

August 1, 2023 · 17 min read

Sebastian Lim

SCS@HashDit

Chris

SCS@HashDit

Overview

This report delves into the security events occurring on BNB Smart Chain (BSC) during 2023 H1. It analyzes the types of projects that were targeted and whether they shared common attack techniques. Additionally, the report examines the financial implications of these occurrences.

Disclaimer

The financial data presented in this report has undergone thorough verification through our internal monitoring system, ensuring its accuracy. The data is derived from the $USD valuation of the cryptocurrency at the time of the incident. It's important to note that due to the inherent volatility of cryptocurrency prices, there may be variations in the total amount lost based on current token valuations.

Furthermore, the financial data might not fully reflect the true “exploited amount” of the incident. This is especially true for scams where the total scammed amount is usually mixed with an initial base amount injected by the scam project party.

BSC Innovations

The first half of 2023 has been an exciting journey for BNB Smart Chain (BSC), marked by continuous innovation and the tireless efforts of the BNB Chain team in crafting and advancing cutting-edge technologies.

Just to name a few in H1:

The Greenfield Testnet went Live: The Greenfield testnet, is an open-source project aimed at providing a scalable and efficient data availability layer for decentralized applications (dApps).

Reduced Transaction Costs: Following extensive discussions, BSC validators have lowered transaction costs from 5 Gwei to 3 Gwei. This reduction in fees will help drive network adoption, making BNB Chain an even more attractive platform for developers and users.
BSC Validators Self-Stake Update: Thanks to an on-chain governance proposal, validators significantly reduced the cost to become a BNB Smart Chain validator, fostering a more diverse and robust ecosystem. This change greatly benefits the community by improving entry cost to be a BSC validator. Self-Staked moved from 10,000 BNB to 2,000 BNB.
BNB Chain exhibited a significant rise in market share, demonstrating steady growth in the percentage of verified smart contracts. Its market share increased from 38% at the beginning of Q2 to 45% by the end of H1. This performance underscores BNB Chain's dominance and the high level of trust placed in its infrastructure by developers and users.

Figure 1: Number of contracts verified weekly across chains (Refer to the Red box for 2023 H1 data)

opBNB and zkBNB: These dynamic layer 2 solutions are poised to revolutionize the BNB Chain ecosystem by further enhancing the capabilities of BNB Chain’s ecosystem; offering developers a boundless horizon to pioneer groundbreaking advancements.

[Refer to the blogs 1, 2 released by BNBChain for more information]

2023 H1 in focus

General

A comprehensive overview reveals that security incidents on BSC resulted in an aggregate loss of nearly $101.84 million. An examination of the monthly breakdown highlights notable patterns. Specifically, the months of May, March, and June emerged as pivotal periods, witnessing the highest recorded losses.

Figure 2: Amount of stolen funds in dollars per month in 2023 H1

This chart shows the number of projects impacted by exploits in 2023 H1.

Figure 3: Number of different project impacted by exploits

In total, there were 199 incidents on BSC.

As seen in Figure 3, the highest number of security incidents took place in June.

Comparison with H1 previous years

When we compare the data with H1 of previous years, there is a decreasing trend, which can signify that the security posture of BNB Chain has improved over the years.

Figure 4: Financial Loss across the previous H1 of 2020 - 2023

Type of attack vectors

Out of the 199 security incidents, hacks took up 66.3%, 33.2% were scams. However, 1 particular incident (0.5%) was a white-hat hack. The white-hat hack is related to a Hashflow project, where an old contract had an Open Approval, this means that any users that have approved funds to the victim contract can have his existing funds stolen.

Figure 5: Proportion of different type of exploits

However, it is interesting to note that even when the number of hacks are nearly doubled to that of scams, the financial impact of hacks were less significant than the ones related to the scams. The total financial loss of hacks ($35m) was nearly half of the loss to scams ($66m), as shown below in Figure 6 below.

Figure 6: Financial impact measured in dollars comparing different types of incidents

Looking at the comparison with 2022 H1, we observed that this trend was actually reversed! In 2022, the number of scam incidents was double that of hack cases, with the financial loss of hacks being double that of scams. You can refer to our previous [report]((https://hashdit.github.io/hashdit/blog/bsc-2022-end-of-year-report/)) for more information.

The observed trend potentially signifies an escalating presence of scammers within the crypto space. Their tactics continuously evolve, challenging users' vigilance. Furthermore, smaller, lesser-known projects may exhibit comparatively lower emphasis on security measures. This underscores the pressing need for heightened awareness and diligence across the ecosystem to safeguard against emerging threats.

Specific attack vectors

Figure 7 displays the specific attack vectors against its financial loss in 2023 H1.

Figure 7: Proportion of the funds lost comparing the different type of vulnerabilities

Looking at the breakdown, the most common loss of funds was attributed to Rugpulls (25%), while the second most common attack vector was due to Reflection Vulnerability. Several token smart contracts deployed on BSC utilize the Reflection mechanism for token holders to gain dividends, however the reflection implementation might be flawed, leading to its liquidity pool being drained by malicious actors. The third most common attack vector was Price Manipulation at 8.2%. This is common as well since poorly designed smart contracts rely on the instantaneous price of liquidity pools, and hence can be easily manipulated by a large Swap trade or Flash Loan by hackers.

Type of projects

When comparing the types of project with the observed financial loss, a whopping 98.8% of financial loss were attributed to DeFi projects. The second most common type of projects that were targeted wasBridge projects at 0.6%, followed by GameFi and Metaverse projects at 0.3% and 0.2% respectively.

Figure 8: Proportion of funds lost comparing the type of project

With a large proportion of fiat loss associated with DeFi projects, this that DeFi projects are still the most common type of crypto project in the space. At the same time, it shows how important it is for users to only invest in reputable and well audited projects, and to stay clear of potential rugpulls and vulnerabilities.

Top 10 incidents in 2023 H1

The following were the top 10 security incidents in terms of financial loss in 2023 H1.

Figure 9: Top exploits measured in dollars in 2023 H1 on the BNB Smart Chain

Fintoch - $31.6 Million Loss

On 25-May-2023, Fintoch, a Ponzi platform was reported to have rugpulled $31.6 million USD. The funds were since bridged to multiple addresses on Tron and Ethereum. Its users reported that they could not withdraw their funds.

Fintoch advertises themselves as a blockchain financial platform built by Morgan Stanley, and users can get 1% return on investment every day. The team’s page on the Fintoch website refers "Bobby Lambert'' as their CEO, when in fact he did not exist and was, in fact, a paid actor. Earlier, the Singaporean government and Morgan Stanley both issued warnings about this “investment plan”.

ippswap - $14.5 Million Loss

On 26-May-2023, a scam project, ippswap was found to have rugpulled $14.5 million USD. The ippswap project executed a concerning action by exploiting a privileged backdoor method, takeToken(), within the staking contract. This unauthorized maneuver allowed the project party to transfer IPPSwap LP Tokens, which had been staked by users, directly to their own account. Liquidity was then subsequently removed using the above LP tokens to gain $14,535,741.86 USDT.

Some of the USDT funds flowed onto Binance exchange where the funds have been frozen by the Binance team.

Safemoon - $8.9 Million Loss

The Safemoon project was exploited for $8.9 million USD on 29-Mar-2023. The Safemoon liquidity pool was compromised after a code upgrade introduced a bug, a public burn() function. The hacker was able to burn the SFM tokens in the liquidity pool, artificially inflating the price of the SFM tokens, and then sold sufficient tokens to wipe out all the WBNB in the pool.

On April 20, the SafeMoon attacker returned 80% of the stolen funds, and transferred 21,804 BNB (approximately $7.2 million) to the SafeMoon vault wallet, taxing the remaining 20% as a bounty.

SwapX - $7.3 Million Loss

SwapX, a DeFi project, faced an Open Approval issue starting from 27-Feb-2023, resulting in users losing more than $7.3 million USD. Users of BSCex / SwapX, a DEX on BNB Chain, had their funds stolen from their wallets. Vulnerabilities were found in four old contracts (deployed on Jan. 2021, May. 2021, July 2021, and Oct. 2021) belonging to the DEX. Many users still have active approvals to these contracts, even though they have not used it for a long time. Affected users remain at risk as long as they have not revoked their approvals.

Atlantis Loans - $3.5 Million Loss

On 12-June-2023, Atlantis Loans faced a malicious Governance proposal takeover, coupled with the abandonment by the core team whichresulted in ~$3.5 million USD loss. On April 12, its official TG channel was deleted and a backup channel was created instead, with multiple users of the community claiming that the project had been abandoned and that they are trying to build it up again. A malicious proposal was then submitted to take over the core contracts of Atlantis Loans which was successfully shut down by the new project party.

However, a similar proposal was submitted on June 12, and was not blocked this time, which resulted in the hacker stealing funds from users that have approved the Atlantis Loans core contracts.

$FUT - $2.7 Million Loss

Early this year on 4-Jan-2023, the $FUT project team conducted a rugpull for $2.7 million USD. The project party was able to invoke the privileged function withdrawSushiReward() of the Masterchef contract to transfer all the FCS to another controlled wallet. He then subsequently swapped all his FCS for $FUT before exiting for USDT. Once again, this shows the risk of over-centralization by the project party, as they have too many privileges and can easily backdoor funds from users.

Circulate - $2.3 Million Loss

On 12-Jan-2023, the Circulate Ponzi managed to scam around $2.3 million USD from users. The CirculateBUSD and CirculateWBNB contracts promised users high APR by depositing funds with them. When users deposit funds, they invoke the startTrading() method of the contract, this in turn calls a third party dependency: SwapHelper contract which is unverified. However, upon decompiling the code, we noticed that there was a hardcoded condition that when the contract reached $2m of staked funds, the funds will be immediately transferred to a designated project team’s address.

Although it is currently unknown how the scammer in this incident was able to get large investment into their recently created contracts (~2 days), it is highly likely that the contracts were scams from the beginning due to design bugs in the SwapHelper contract. On the whole, third party dependencies in smart contracts present a security risk. Whilst reliance on third parties such as the use of oracles is sometimes unavoidable, developers should avoid these dependencies as much as possible.

YieldRobot - $2.1 Million Loss

On 17-Jan-2023, YieldRobot scammed users of around $2.1 million USD. For context, YieldRobot is a De-Fi protocol which promises to give yield for users that deposit BUSD. Two days prior to the incident, the YieldRobot contract deployer wallet set the signer to a new EOA (0x3f531). The signer address is needed to approve the redemption of coupons.

In order to redeem a coupon it must pass a check to verify it has the correct signer. Once approved, the coupon is added to the user’s reward balance. In this incident, 0x8f2DB called setCoupon() which credited them 2.1m BUSD.

The new signer approved the malicious coupon redemption, as such he was able to claimRewards of the contract’s BUSD balance and drain all the BUSD funds.

LianGo Protocol - $1.6 Million Loss

On 7-Feb-2023, the LianGo protocol was exploited for $1.6 million USD, roughly 6,148,859 LGT reward coins were stolen. For context, LianGo is a decentralized payment consumption and LGT is their main token.

The reason for the theft was that the owner administrator of LGTPool created a fake LP token pledge pool (pool 3), and then the thief put a large amount of LP tokens into the pool, pledged and obtained 6.14 million LGT reward tokens.

Based on on-chain data, the thief has been preparing for the theft for a long time. 58 days before the incident, the stealer’s address obtained the gas fee from Tornado Cash, and deployed the fake LP contract 32 days before the incident.

Then on the same day the LianGoPay project deployed the trading pair contracts of LGT tokens and WBNB on Pancake. This contract address is very similar to the address of the fake LP contract that was deployed earlier -- the 4 letters before and after are the same, which can be easily confused. As such, it is likely a private key compromise to the project’s back end system.

The administrator of the LGTPool contract initiated three consecutive transactions to create pledge pools, the first two of which also created a real one when creating two fake LP token pledge pools (pools 3 and 4). LP token pool for WBNB and LGT. Because the front and rear four digits of the real and fake LP token contract addresses are the same, it is difficult for users to detect that the first two created LP pools are fake LP pools.

Then the attacker launched an attack, first deploying an attack contract. When the contract was initialized, a huge amount of fake LP tokens was pledged for the fake No. 3 LP pledge pool - up to 614885935211982505426257800000000.

Then the attacker initiated a redemption transaction and received the rewarded LGT tokens. Because of the huge amount of pledged principal, 6.14 million LGT rewards were generated. These reward tokens were exchanged for 1.62 million BSC-USD tokens and transferred to an address starting with 0xCb65 (this address used to receive gas fees from Tornado Cash 58 days before the incident).

DeusDAO (DEI) - $1.3 Million Loss

On 6-May-2023, the DeusDAO (DEI) project was hacked for slightly more than $1.3 million USD due to a wrong contract upgrade. The project was hacked on 3 different chains: Ethereum, Arbitrum and on the BNB Chain. The upgrade bug introduced a public burn vulnerability, which allowed attackers to steal funds from other wallets that have DEI tokens.

Conclusion

BSC continues to be a strong competitor, outperforming Ethereum in terms of daily active users and verified contracts. However, it is undeniable that 2023 H1 has proven to be a challenging year for both investors and developers due to the continued bear market trend and exploit incidents. Below we have some final advice for investors and developers:

For investors:

Understand what you're signing, do not blindly sign random signatures/transactions (never sign signatures outside of official websites)
Always double check that you are on the official website of the dApp
Be wary of new/trending projects or projects that guarantee High APYs / use MEV bots, and always verify the project team’s authenticity
Use multiple wallets for different activities (hot wallet for frequent transactions; cold wallet to store high value funds)
Ensure you are interacting with an open-source contract and revoke approval once interaction is done
Check the security and risk scores of interacted contracts (e.g when using Trust wallet) If High Risk is flagged, we strongly advise to stay away

Feel free to reach out to our team if you have any doubts about a certain project / contract address / transaction / risk score!

For developers:

Verify & open-source all relevant contracts on-chain (to ensure transparency and trust within the space)
Ensure the project is audited by at least 2 well-known security companies and fix all issues where applicable (Including auditing newly added code)
Incorporate / Implement a bug-bounty program to upkeep the security posture of the project and encourage the community to ensure the code remains secure
Ensure security is at the core of the business: run sufficient testing / stress-testing / simulations such as (1) adverse token price fluctuations, (2) edge cases
Prevent centralization risks by using multi signature wallets and not a single EOA wallet to run operations
Minimize contract upgradeability and only apply to contracts when necessary
Ensure funds are stored securely (key management, fund distribution)
Implement safeguards in the event of a hack (formulate an Incident Response plan, introduce time lock / pausing within the smart contract)
Constant monitoring of system parameters e.g Exchange Rate of a token

Hashdit

HashDit’s core mission is to provide the essential threat intelligence for the everyday crypto investors, helping them to make informed decisions. Our methodology includes a variety of automated and manual techniques to evaluate a dApp project. The team has optimized its product offerings and improved its accuracy in 2023 H1.

Products at Hashdit currently:

Risk assessment: All-in-one collection of security rating framework, auto-scan tools, and corresponding APIs, which are able to deliver accurate detection for potential rugpull/exploit risks based on a smart contract address. This is integrated with platforms like Trust Wallet and PancakeSwap, to leverage their reach and protect more users.
It is able to detect multiple other risks, besides the usual SWC bugs, such as Tornado Cash interaction, risky functions encompassing ERC20 or ERC721 token standards (such as Migrate() or Blacklist() ), HoneyPot detection, etc. This can help users gain a better understanding of the smart contract, if it could be a scam.
Audit service: Comprehensive code audits following extensive and detailed best practices for smart contracts and discovering code loopholes / security vulnerabilities before they are deployed on-chain, guaranteeing users’ safety on BSC.
Monitoring: Detecting sensitive events / transactions that happen on-chain to quickly respond and minimize any additional financial losses. At the same time, Hashdit warns users early by sharing any information we found on our Twitter
Blog: Our goal is to share our security knowledge for builders, investors and users in the Web3 community. With all the players in the industry equipped with the security knowledge needed and adopting a security-first mindset, only then will the Web3 ecosystem be a safer place for everyone.

Zero-Knowledge Proof and Its Application in Blockchain

April 12, 2023 · 10 min read

Hashdit team

SCS@HashDit

Since the birth of Bitcoin, the blockchain has evolved from a simple ledger to encompass trustworthy computation, storage, and even web applications. It's amazing to think that the successor of the first von Neumann machine, the modern computer, brought us many fascinating applications such as AI, VR, games, and the web. Most of these advancements were made possible by improving the computational power of computers.



[First Von-Neuman Machine)[1]]	Blockchain Virtual Machine[2]

While our current decentralized virtual machine on the blockchain is slow, expensive, and transparent, it still garners great attention and interest due to its trustworthy properties. If the computational power of the blockchain virtual machine were to be massively improved, it's believed that a huge evolution would come. This is where interesting cryptography schemes like "interactive proof" and "zero knowledge proof" come into play. They could significantly contribute to improving the computational power of the blockchain virtual machine and pave the way for even more exciting applications in the future.

In addition to ensuring the integrity of data, the consensus mechanism in blockchain does not provide any confidentiality guarantees by default. However, by using advanced cryptography techniques, such as zero knowledge proofs, confidentiality can be achieved on the blockchain virtual machine. Zero knowledge proof is an essential cryptographic tool that can help protect sensitive information on the blockchain, ensuring that only authorized parties have access to it. With zero knowledge proofs, the confidentiality of data is maintained, while still preserving the transparency and security of the blockchain network.

Interactive Proof vs Zero knowledge Proof

In the exciting and ever-changing world of cryptocurrency, you might come across the abbreviation "ZK". Typically, this refers to "zero knowledge", which is often associated with something called "zero knowledge proofs". However, it's important to note that in some cases, "ZK" might actually stand for "interactive proofs". This can be confusing for those who aren't familiar with the difference between the two.

To provide a concrete illustration of the concept, consider the following scenario: Imagine that you make a claim to your friend that you possess the ability to differentiate the two faces of any coin. To put your assertion to the test, your friend hands you a random coin and asks you to demonstrate your ability by describing how you differentiate the two faces. After several rounds of this exercise, your friend becomes convinced that you possess the ability to distinguish the two sides of a coin.

In this example, your friend serves as the verifier, seeking to determine whether your claim of coin differentiation is genuine. You, on the other hand, act as the prover, seeking to convince your friend of your ability without revealing the details of your method. This scenario resembles an interactive proof, in which the verifier challenges the prover to demonstrate their knowledge, and the prover responds with evidence that satisfies the verifier's demands.

On the other hand, zero knowledge proofs are a little different. This time you do not want to reveal how you differentiate the two faces. In this case, you and your friend both know the initial state of the coin, and you turn away while your friend decides whether to flip the coin or leave it in its current state. When you turn back, your friend asks you whether or not the coin has been flipped. If you can consistently answer correctly, your friend becomes convinced of your ability to differentiate the two faces of the coin.



Interactive Proof	Zero Knowledge Proof

So, the next time you see "ZK" in the world of cryptocurrency, remember that it might refer to either zero knowledge proofs or interactive proofs. While they're both important concepts in cryptography, they're not quite the same thing!

Another commonly seen fascinating term is SNARK (Succinct Non-interactive Argument of Knowledge), which can be broadly understood as those zero knowledge proofs with cheap communication and computational cost for the verifier. Do you know what "zk-SNARK" means? Yes, you are right - it refers to SNARK with zero knowledge properties. For further elaboration, the zk-SNARK (Zero-Knowledge Succinct Non-Interactive Argument of Knowledge) protocol embodies the following characteristics:

Zero-Knowledge: The proof does not reveal any information about the knowledge itself.
Non-interactive: The proof can be conveyed in a single message from the prover to the verifier, eliminating the need for back-and-forth interaction.
Argument: The interaction between the prover and verifier is limited, consisting of only a few rounds and minimal communication cost.
Knowledge: The proof demonstrates that the prover possesses certain knowledge or information, without revealing the information itself.

Together, these features make zk-SNARKs a powerful tool for verifying the authenticity and validity of claims, while preserving the privacy and security of sensitive information.

Interactive Proof/SNARK in Blockchain

Smart contracts provide a trusted computing solution where they execute exactly as programmed, and the results cannot be tampered with by any party. However, this process can be slow and costly in some cases. In such situations, it may be more efficient to verify answers rather than computing/searching by themselves. Interactive proof can be used in the blockchain virtual machine to achieve faster computation and reduce costs. The smart contract includes a trusted verification function for incoming advice, and untrusted machines prove the validity of the computation to the verifier on-chain.

1. SNARK improves scalability

Blockchain technology has been gaining a lot of attention due to its decentralized and immutable nature. However, one of the major challenges of blockchain is scalability. As more users join the network and more transactions are added, the processing time and costs increase exponentially. This can lead to a slow and expensive network, which is not practical for mass adoption.

SNARK helps reduce the transaction size by compressing the amount of data required for verification. In a traditional blockchain system, each transaction is accompanied by a set of data, including the public key of the sender, the signature, and the hash value. This data is required to verify the validity of the transaction.

However, with SNARK, the transaction data can be compressed into a shorter proof. The proof is then used to verify the transaction, instead of the full data set. This makes the transaction much smaller in size, as only the proof needs to be stored on the blockchain.

By reducing the transaction size, SNARK helps improve the scalability of blockchain. As more transactions can be processed in a shorter amount of time, the overall speed and efficiency of the network is improved.

Moreover, smaller transactions also mean lower transaction fees, making the network more accessible to a wider range of users. This can further drive adoption and increase the value of the blockchain network.

2. SNARK on Layer2 blockchain

Layer 2 solutions are a popular approach for scaling blockchain technology. These solutions sit on top of the main blockchain and are designed to improve the speed and efficiency of transactions. One such solution is the use of sidechains or state channels. However, to ensure the security and privacy of the underlying data, these solutions require a robust proof system. SNARK is one such technology that can help to achieve this goal.

In a sidechain implementation, SNARK technology generates proofs that validate transactions on the sidechain, without revealing the underlying data. These proofs are then sent back to the main blockchain to ensure the transactions are accurate and valid. This approach helps to reduce the load on the main blockchain, allowing for a greater number of transactions to be processed.

Similarly, in state channel implementations, SNARK can be used to create a trustless channel between two parties. This enables them to conduct multiple transactions off-chain, reducing the number of transactions that need to be processed on the main blockchain. The channel is secured by a deposit held on the main blockchain, and SNARK is used to generate proofs of the transactions, which can be verified by the main blockchain at any time.

ZKP/zk-SNARK in Blockchain

ZKP plays a crucial role in enhancing the privacy and security of blockchain networks and many contributors on this new field to enhance the privacy of Web3.0 with ZKP. In overview here are some ways ZKP is used in blockchain:

1. Identity Verification

In a blockchain network, Zero-Knowledge Proofs (ZKPs) can be used to confirm a user's identity without disclosing any personal information. This is especially valuable in decentralized systems, where anonymity is essential.

Consider this scenario: Alice needs to prove that she is over 18 years old to a third party, but she doesn't want to reveal her actual age or any other sensitive information. Typically, Alice would have to show some form of identification that includes her age and potentially other personal details. However, with ZKPs, Alice can demonstrate her age without compromising her privacy.

Here's how it works: Alice creates a unique digital identity on the blockchain network and generates a ZKP that verifies she is over 18 without revealing her exact age. Alice and the third party engage in a series of interactive computations that demonstrate her age is greater than 18. The third party can then verify the accuracy of the proof without learning Alice's actual age or any other personal information.

This approach to identity verification is highly relevant in industries such as finance, healthcare, and voting where privacy and security are crucial. By using ZKPs, individuals can safeguard their personal information while still proving their identity to third parties.

2. Zero Knowledge Transaction Verification

ZKP can also be used to verify the validity of a transaction without revealing any sensitive information about the transaction. This is particularly useful in financial transactions, where privacy is a top concern. ZKP can be used to prove that a transaction is valid without revealing the amount or the parties involved. Recall that zero knowledge proof is interactive proof with zero knowledge properties, it's the in the same manner as the interactive proof for transaction verification but with confidentiality guaranteed.

3. Verifiable Random Function

Verifiable Random Functions (VRF) are cryptographic functions that produce random outputs while providing a proof that the output is truly random. ZKP can be used to create a VRF that provides a secure, decentralized, and transparent system, ideal for various cryptographic applications.

The VRF is generated using a secret key and a seed value. The ZKP generates a short proof that the VRF output is based on the seed and the secret key, without revealing any information about either value. This proof can then be used to verify the randomness of the VRF output, without requiring the verification party to know the secret key or the seed value.

The use of ZKP in VRF ensures that the output is random, non-predictable, and fair, making it an ideal solution for various use cases, including blockchain-based systems, where fairness and security are essential.

Conclusion

In conclusion, ZKP is a powerful tool for enhancing the privacy and security of blockchain networks. It enables blockchain networks to verify identities, transactions, and smart contracts without revealing any sensitive information. As blockchain technology continues to evolve, ZKP is expected to play an increasingly important role in ensuring the privacy and security of these networks.

Multisig Wallet Migration Guide

January 7, 2023 · 10 min read

Himura K.

SCS@HashDit

Smart Contract Wallets, the Future of Crypto Wallets?

Multi-signature wallets, also referred to as multisig wallets, are standardized smart contracts that consolidate multiple accounts and private keys into a single wallet for managing crypto assets. The main goal of a multisig wallet is to create redundancy by requiring multiple private key signatures to authorize a transaction, similar to other crypto wallet solutions. Smart wallets utilize a group of exclusive key pairs and wallet owners can set the minimum number of signatures required for authorizing any transaction, allowing them to distribute the keys associated with the primary wallet to other parties and decentralize the responsibility of managing funds. As a result, multiple parties must sign off on a transaction before it is validated, providing an extra layer of security for the wallet and the crypto assets associated with it. This mechanism also prevents malicious actors from accessing funds if one of the accounts private keys is lost or stolen.

To learn more about the risks associated with traditional crypto wallets and to get a comprehensive technical analysis of the benefits of using a multisig wallet, please check out our article, The Risk and Future of Crypto Wallets. In this article, we compare MPC Wallet and Smart Wallets and explain which one is preferable from a security perspective. As crypto wallets are a critical component in a blockchain system, it is crucial to establish robust policies, guidelines, and best practices to safeguard and benefit the entire community.

That's why we've created a guide on how to migrate from a conventional wallet to a multisig solution. Since crypto wallets are a single point of failure, we recommend transitioning to smart wallets to reduce the impact if one of the private keys is intentionally or accidentally leaked. Additionally, this significantly diminishes the likelihood of former employees attacking the protocol in case of an inside job.

How to Migrate to a Smart Wallet

This guide outlines the process of migrating your wallets to a secure multisig wallet using Gnosis Safe and Trust Wallet. We provide step-by-step instructions for you and your team to perform a straightforward migration by transferring smart contract ownership to the newly created multi-sig wallet.

migration

Figure 1: Time to migrate.

Out of scope

The following point will not be detailled on our guide.

To create an account on Trust Wallet. Please refer to this guide .
For a detailed explanation of the usage of an upgradable contract, please refer to Openzeppelin Documentation.
Technical teams should be able to choose their favorite web3 development and testing framework to properly create the transactions required to perform the contract migration. Also, they should be able to perform the proper setup for testnet and mainnet.

Migration Prerequisites

We highly recommend that all projects managing significant amounts of crypto assets, such as project treasuries, migrate their funds to new smart wallets. Additionally, we strongly advise projects with simple crypto wallets that have elevated privileges in their decentralized applications to switch to a multisig solution. If your project has any roles with elevated privileges in its smart contracts, it is essential to migrate all the wallets from classic to multisig setups. This guide provides detailed instructions on how to use Gnosis Safe and Trust Wallet to manage the Safe. However, before considering migrating your smart contracts to a multisig solution, ensure that your project complies with the following requirements:

Make sure your smart contracts have a mechanism to change the addresses with elevated roles. For instance, if your smart contract is using the Ownable interface, one might be able to use the contract function transferOwnership to transfer the ownership between addresses - in this case from an External Owned Address (EOA) to the multisig wallet. If your contract does not have this capability to change a role address, we suggest adding such capability to a new version of your smart contract and upgrading it. Note: to upgrade one’s smart contract, one needs to use a proxy smart contract. Create your Multisig wallet using Gnosis Safe. Create your free Trust Wallet account, on mobile or desktop.

Migration steps

Creation of a Gnosis Safe.
Prepare smart contract migration in the test phase (testnet).
Perform and validate smart contract migration on production (mainnet).

Create the Gnosis Safe

Start the creation process

To create a new Gnosis safe multi-wallet, connect to their official website and select the option to create a new Safe.

Create Wallet

Figure 2: Gnosis Safe safe creation process

Use Wallet Connect

To connect their multisig wallet with Trust Wallet, select the WalletConnect plugin.

Connect Wallet via WalletConnect

Figure 3: Connecting Trust Wallet via WalletConnect

Connect With Trust Wallet

Open Trust Wallet with the device of your choice. Trust Wallet exists for mobile android, iOS, Web plugins's and desktop platforms.

To associate your wallet with the multisig one, use your favorite platform and either scan the QR code that appears on your screen with your smartphone or upload the QR code using the associate feature in the app. Make sure to choose the Trust Wallet with enough funds to pay for the Transaction. In our case, the multisig creation cost only 0.31$.

Figure 4: Wallet Connect QR code connection.

Associate the wallets via QR code identification.

After scanning the QR code with the Trust Wallet application, the Trust Wallet BNB Smart Chain address becomes available on the right top corner of the following page.

Setup the multisig wallet details

Choose a multisig wallet name that is displayed in the Gnosis Safe web app. Finally, make sure you select the BNB Smart Chain network.

Safe Setup

Figure 5: Safe wallet setup for BNB Smart Chain, connected to one’s Trust Wallet account.

Setup the wallets and threshold.

Click Next and add the other wallet addresses of the wallets used to validate your transactions.

For relevant crypto wallets, we recommend at least 3 signatures. Also, we recommend using a threshold of at least 50% of the total number of associated wallets. The more keys a project manages the larger surface of the attack and the higher the probability of mismanaging them or having them stolen.

Such a recommendation comes after the incident with Harmony Horizon Bridge had 2 out of 5 private keys stolen and also raised a concern about how to securely manage private keys on a validator node… But that's a discussion for another time.

Smart wallet wallets Setup

Figure 6: Setup of underlying wallets associated with the multisig wallet.

Review the final setup.

The next page displays the summary of the Wallet setup.

Smart wallet wallets Setup

Figure 7: Multi Sig creation Summary.

Validate the multisig creation from your TrustWallet app.

When clicking next, your Gnosis requests the confirmation and the signature from your first and main wallet. In the meantime, the screen looks like this:

Wallet creation awaiting confirmation

Figure 8: Wallet creation awaiting confirmation.

This is the message you receives in your Trust Wallet application:

Figure 9: Trust Wallet mobile app view on multisig wallet creation approval.

Approving the transaction pays the required fees for Gnosis to deploy the multisig smart contract on the chain. Once the transaction is approved and paid, the Gnosis web app should change to

Safe created

Figure 10: Successful creation of the smart wallet.

Finally, you can see your multi-wallet created in the Safe. You find the following page with your multisig wallet address. This is the new 0x address you should use when migrating your contracts.

Safe account summary

Figure 11: Gnosis Safe account with the newly created multi-signature wallet.

Managing Gnosis multisig wallet.

After the creation, it is still possible to perform changes in wallet composition. it is possible to manage (add, remove) the wallets associated with the multisig one as well as change the threshold number for validating transactions.

For this reason, access to the Gnosis Safe app should be very limited. Never leave your notebook unlocked and don’t use password-saving features in web browsers. Make sure to have a clear change management process for performing this kind of change.

Safe account summary

Figure 12: Gnosis Safe multisig settings enabling multisig wallet management.

Prepare smart contract migration on Testnet

Before performing the migration directly on the main net. Projects should always try to perform the migration in the BNB smart chain test chain. However, it is possible your team already has internal technical guidelines or processes regarding such migration. Make sure to check with your team lead before moving forward.

Even if Trust wallet and Gnosis Safe aren’t (yet) available in BNB smart chain testnet, it is important to test the transaction in the testnet and validate that your transaction has the expected results. Transferring the ownership of a smart contract to an address you don’t own can have serious consequences. You would not only make you lose control of the smart contract and its associated funds but it would also make you lose ownership of all the smart contracts that the first smart contract owned.

1 - Load the target smart contract in BNB smart chain Testnet using Hardhat or Truffle

2 - Execute the transaction to change the address of the privileged role. For instance, using the transferOwnership method for contracts relying on the Ownable smart contract.

Using the following brownie script One can change the ownership of a dummy contract that uses Ownable interface. It only requires us to use the transferOwnership capabilities.

Brownie Snippet

Figure 13: Brownie python snippet enabling the transfer of ownership of a token contract.

3 - After executing the transaction, make sure that the address has changed according to your expectation. Either check using the testing frameworks of the respective framework you are using. Chai for Hardhat or Mocha for Truffle. The result is also available in BNB testnet chain explorer: https://testnet.bscscan.com/

Verification on BSC Scan

Figure 14: Alternatively verifying results in BSC scan.

Note: the best practices would require the project teams to use the same tech in the test phase - Gnosis Safe and Trust Wallet but they are not available in Test net. Therefore feel free to use other wallet solutions compatible with BNB smart chain testnet such as Metamask.

Note 2: One might feel comfortable using the dev tools forking mechanism to perform the test locally and validate that the transaction has the expected results. However, for larger projects, small changes can have a considerable impact on their other smart contracts. Also, other decentralized applications might depend on them. Therefore it is preferable to perform such validation in a long-lasting environment such as the actual Blockchain Testnet environment. Also, running all integration tests might be required to confirm no collateral issues.

Perform and validate smart contract migration on Mainnet

Now it is time to perform the previous steps on mainnet. Make sure that your wallet has enough funds to perform the change in the smart contract.

Script execution in prod

Figure 15: Script execution result for mainnet.

TL;DR​

Type of projects​​

Chain comparison​

Attack Type analysis​

Top 10 incidents on L2 thus far​

BALD - $25.6 Million Scam​

Multichain - $28.6 Million Exploit​

Defrost - $12 Million Scam​

Platypus - $8.75 Million Exploit​

Jimbos - $7.5 Million Exploit​

Exactly - $7.32 Million Exploit​

Hundred Finance - $7 Million Exploit​

Lodestar Financ - $6.9 Million Exploit​

Magnate Finance - $6.4 Million Scam​

Deus DAO (DEI) - $5 Million Exploit​

Conclusion:​

Developers should​

Users should​

Disclaimer​

Overview​

High Risk TVL protocol on PCS​

Key themes on high risks:​

Integrations with PancakeSwap​

Stay Safe!​

About HashDit?​

Disclaimer​

Overview​

High Risk TVL protocol on PCS​

Key themes on high risks:​

Integrations with PancakeSwap​

Stay Safe!​

About HashDit?​

Introduction​

Security Control Improvements in the BSC Ecosystem​

Word of Advice​

Disclaimer​

Overview​

High Risk TVL protocol on PCS​

Key themes on high risks:​

Integrations with PancakeSwap​

Stay Safe!​

About HashDit?​

Ponzi Schemes in Web3 --- Swamps in the Dark​

What's a "ponzi"?​

Ponzi schemes in Web3​

Decrypting a Ponzi project smart contract​

Go further: A complete Ponzi example for more tech-savvy users​

Identifying Ponzi schemes in a more simple way​

Appendix​

Disclaimer​

Overview​

Stay Safe!​

About HashDit?​

High Risk Subjects this week​

WAT stands for Weekly Active Transactions​

Top TVL Pools​

Trending Pools​

Trending Tokens​

Overview​

Disclaimer​

BSC Innovations​

2023 H1 in focus​

General​

Comparison with H1 previous years​

Type of attack vectors​

Specific attack vectors​

Type of projects​

Top 10 incidents in 2023 H1​

Fintoch - $31.6 Million Loss​

ippswap - $14.5 Million Loss​

Safemoon - $8.9 Million Loss​

SwapX - $7.3 Million Loss​

Atlantis Loans - $3.5 Million Loss​

$FUT - $2.7 Million Loss​

Circulate - $2.3 Million Loss​

YieldRobot - $2.1 Million Loss​

LianGo Protocol - $1.6 Million Loss​

DeusDAO (DEI) - $1.3 Million Loss​

Conclusion​

Hashdit​

TL;DR

Type of projects

Chain comparison

Attack Type analysis

Top 10 incidents on L2 thus far

BALD - $25.6 Million Scam

Multichain - $28.6 Million Exploit

Defrost - $12 Million Scam

Platypus - $8.75 Million Exploit

Jimbos - $7.5 Million Exploit

Exactly - $7.32 Million Exploit

Hundred Finance - $7 Million Exploit

Lodestar Financ - $6.9 Million Exploit

Magnate Finance - $6.4 Million Scam

Deus DAO (DEI) - $5 Million Exploit

Conclusion:

Developers should

Users should

Disclaimer

Overview

High Risk TVL protocol on PCS

Key themes on high risks:

Integrations with PancakeSwap

Stay Safe!

About HashDit?

Disclaimer

Overview

High Risk TVL protocol on PCS

Key themes on high risks:

Integrations with PancakeSwap

Stay Safe!

About HashDit?

Introduction

Security Control Improvements in the BSC Ecosystem

Word of Advice

Disclaimer

Overview

High Risk TVL protocol on PCS

Key themes on high risks:

Integrations with PancakeSwap

Stay Safe!

About HashDit?

Ponzi Schemes in Web3 --- Swamps in the Dark

What's a "ponzi"?

Ponzi schemes in Web3

Decrypting a Ponzi project smart contract

Go further: A complete Ponzi example for more tech-savvy users

Identifying Ponzi schemes in a more simple way

Appendix

Disclaimer

Overview

Stay Safe!

About HashDit?

High Risk Subjects this week

WAT stands for Weekly Active Transactions

Top TVL Pools

Trending Pools

Trending Tokens

Overview

Disclaimer

BSC Innovations

2023 H1 in focus

General

Comparison with H1 previous years

Type of attack vectors

Specific attack vectors

Type of projects

Top 10 incidents in 2023 H1

Fintoch - $31.6 Million Loss

ippswap - $14.5 Million Loss

Safemoon - $8.9 Million Loss

SwapX - $7.3 Million Loss

Atlantis Loans - $3.5 Million Loss

$FUT - $2.7 Million Loss

Circulate - $2.3 Million Loss

YieldRobot - $2.1 Million Loss

LianGo Protocol - $1.6 Million Loss

DeusDAO (DEI) - $1.3 Million Loss

Conclusion

Hashdit