Nexera Protocol Suffers $1.5M Smart Contract Breach

August 07, 2024

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Decentralized finance (DeFi) protocol Nexera has recently been exploited, resulting in the loss of $1.5 million worth of digital assets. This breach underscores the ongoing challenges within the DeFi sector, particularly concerning smart contract security.

Details of Attack

Nexera became the latest victim of a cyberattack when hackers targeted its Nexera (NXRA) tokens. On August 7, Cyvers, a blockchain security firm, flagged the suspicious activity in a post on X. The firm stated:

“An address took ownership of [Nexera’s] proxy contract and upgraded it. Shortly after, the address used the withdraw admin function to transfer all the $NXRA tokens.”

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Notably, the attackers are currently selling all the tokens for ETH, and some of the funds have already been bridged to the BNB chain. This conversion to Ether is a common tactic used by cybercriminals to obscure the origins of stolen funds, often utilizing cryptocurrency mixers to launder the assets and evade detection.

The control over Nexera’s proxy contract allowed attackers to exploit the admin functions and siphon off the tokens. While the $1.5 million theft might be considered minor compared to larger heists, it raises concerns about the security protocols in place for DeFi platforms.

A Rise in Security Breaches

This exploit occurred merely a day after the Ronin Network faced a similar breach, losing $9.8 million worth of Ether. Interestingly, the Ronin attacker, believed to be a white hat hacker, returned the funds within hours.

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However, Nexera’s situation appears more dire, as the hacker is reportedly attempting to liquidate the stolen NXRA tokens.

The blockchain investigator ZachXBT provided additional insights, linking the Nexera hacker to previous exploits. On August 7, he revealed in a Telegram post, “Attacker is connected on-chain to recent private key compromise incidents such as SpaceCatch, Concentric Finance, OKX DEX, Serenity Shield, Reach, and many more.”

A Serious Concern

The Nexera hack follows closely on the heels of another significant incident. Nearly three weeks ago, over $230 million was stolen from Indian crypto exchange WazirX.

These incidents collectively point to an urgent need for the DeFi sector to bolster its defenses. The frequency and scale of these breaches are not only damaging to individual platforms but also erode trust in the broader cryptocurrency market. While DeFi offers revolutionary potential in democratizing finance, its promise is continually undermined by these security challenges.