Bunny and Qubit turn to DAO after $80M exploit

The development team behind Bunny Finance and Qubit has decided to disband the protocol and turn it into a decentralized autonomous organization (DAO).

In an official post published Friday, the Bunny Finance team announced that a bug on Qubit resulted in losses worth $80 million, preventing the team from fully operating. Therefore, they decided to dissolve the agreement and give power to the community.

As Cointelegraph reported earlier, the Qubit bridge, dubbed X-bridge, facilitates token swaps from Ethereum to Binance Smart Chain (BSC). The hackers behind the attack managed to exploit a "logic error" in the X-Bridge smart contract, allowing them to withdraw tokens on the BSC chain without depositing any tokens on Ethereum.

The hacker managed to steal 77,162 qXETH, worth $185 million, and used it as collateral to borrow several assets worth $80 million from a lending pool. These borrowed tokens include 15,688 wETH worth $37.6 million, 767 BTC-B ($28.5 million), $9.5 million in stablecoins, $5 million in PancakeSwap (CAKE), Pancake Bunny (BUNNY) and MDX tokens currency.

The official announcement pointed out that in the future, the community will be responsible for major decisions, including upgrading contracts and changing the fee structure. In order to change the protocol to a DAO, the development team has shut down the Vaults on Bunny and will no longer mint native tokens. The team also shut down leveraged Farming Vaults and Single Asset Vaults on Qubit for lending into assets.

The development team has also decided to discontinue the main fee structure. The team will also launch a new marketplace on Qubit and move away from the old model that was hacked. All team tokens will be locked in a community smart contract, and the profits of the contract will be used as a compensation pool. Existing members of the team will participate as members of the DAO.

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