The Fundamental Reason Behind the Hacker Attack on 0VIX According to BlockSec

According to reports, security agency BlockSec tweeted that the fundamental reason for the hacker attack on the Polygon ecosystem project 0VIX Protocol is the flawed pricing calculation of deflationary tokens. Specifically, vGHST is the equity token of GHST, and the lending platform provides a market for vGHST (ovGHST). The ovGHST price oracle machine depends on the conversion rate from vGHST to GHST. The attacker first borrows a large amount of vGHST in contract 0x49c6 to increase the corresponding borrowing amount. Afterwards, he transferred a large amount of money to the vGHST contract. This will affect the conversion rate from vGHST to GHST. Therefore, the contract 0x49c6 becomes insolvency, and the attacker gains by clearing the contract.

Security Agency: The root cause of 0VIX being attacked is a flaw in the price calculation of deflationary tokens

As blockchain technology continues to evolve, so does the risk of security attacks. The Polygon ecosystem project, 0VIX Protocol, was recently targeted by a hacker who exploited a flaw in the pricing calculation of deflationary tokens. According to a tweet from security agency BlockSec, this flaw in the pricing calculation of 0VIX Protocol’s token, vGHST, allowed the attacker to manipulate the system to their advantage. In this article, we will delve deeper into the issue and discuss what can be learned from this type of attack.

Understanding Deflationary Tokens and vGHST

Before we can understand the reason behind the attack on 0VIX’s vGHST token, we need to understand what deflationary tokens are and how they work. Deflationary tokens, as the name suggests, are tokens in which the total supply gradually decreases over time. This is achieved through the use of smart contract algorithms that automatically burn a portion of the tokens on each transaction, reducing the number of tokens in circulation and increasing the value of each remaining token.
vGHST is the equity token of GHST, a lending platform that provides a market for vGHST (ovGHST). The price of ovGHST is determined by a price oracle that calculates the conversion rate from vGHST to GHST. This means that the value of vGHST is inherently linked to the value of GHST.

The Attack on 0VIX’s vGHST Token

According to BlockSec, the hacker initiated the attack by borrowing a large amount of vGHST in contract 0x49c6. By doing so, the corresponding borrowing amount was increased, providing the attacker with greater profits if they were successful in their manipulation of the system.
The next step taken by the hacker was to transfer a large amount of money to the vGHST contract. This disrupted the conversion rate from vGHST to GHST, creating an insolvency in contract 0x49c6. By doing so, the attacker was able to clear the contract and gain profits from their manipulation of the system.

Lessons Learned from the Attack

The attack on 0VIX’s vGHST token highlights the ever-present threat of security attacks in the blockchain space. It also serves as a reminder of the importance of transparent and accurate price oracles, which can play a critical role in ensuring the stability and reliability of decentralized systems.
Additionally, the attack brings focus to the importance of ensuring proper safeguards are in place to protect smart contracts from manipulation. This includes ongoing monitoring and identification of potential vulnerabilities, as well as implementing measures to mitigate risk and prevent attacks from occurring.

Conclusion

The attack on 0VIX’s vGHST token highlights the increasing need for secure and reliable decentralized systems. It serves as a reminder of the importance of ongoing vigilance and action to mitigate risk and protect against potential security threats. By investing in innovative solutions and staying alert to emerging threats, we can continue to improve and secure the future of blockchain technology.

FAQ

**Q1. What is a deflationary token?**
A1. A deflationary token is a token in which the total supply gradually decreases over time through the use of smart contract algorithms that automatically burn a portion of the tokens on each transaction.
**Q2. What is the relationship between vGHST and GHST?**
A2. vGHST is the equity token of GHST, a lending platform that provides a market for vGHST (ovGHST). The price of ovGHST is determined by a price oracle that calculates the conversion rate from vGHST to GHST.
**Q3. What measures can be taken to mitigate the risk of security attacks in the blockchain space?**
A3. Ongoing monitoring and identification of potential vulnerabilities, implementing measures to mitigate risk, and ensuring proper safeguards are in place to protect smart contracts from manipulation.