DeFi Protocol OracleSwap Loses Private Keys in Recent Hack

In Brief

• OracleSwap, a DEX protocol on the Songbird Network, has suspended operations due to the compromise of its private keys.
• FlareMetrics has advised delegates on OracleSwap to change to other FTSO operators and revoke access due to the risk of having their rewards stolen by bad actors.
• OracleSwap plans to start a fresh FTSO infrastructure under new addresses after the improvement proposals are implemented.
  
  

OracleSwap, a decentralized exchange (DEX) protocol on the Songbird Network, has recently become the subject of concern among its users and the wider decentralized finance (DeFi) community.

The protocol, which allows users to earn interest for delegating their Flare and Songbird tokens, announced on Jan. 28 that its private keys had been compromised as a result of making its code open source. This has led to calls for caution from FlareMetrics, a data provider for the Flare Network, who have urged delegates on OracleSwap to change to other FTSO operators and revoke all access to the protocol.

All Hell Breaks Loose at OracleSwap
OracleSwap had to make its v2 repos public so the FTSO community could see the developers who worked on the code. Still, the unintended consequence of this was that its private keys were disclosed and could potentially be used by bad actors to steal rewards from its users.

As a result, FlareMetrics has recommended that delegates on OracleSwap change to other FTSO providers to avoid this outcome. The data provider also advised delegates to revoke all access to the protocol to prevent bad actors from gaining a significant amount of voting power.

In response to the situation, OracleSwap has announced that it will burn the codes and work on a new contract. The company stated that it will start a fresh FTSO infrastructure under new addresses after the improvement proposals have been implemented.

The incident highlights the ongoing challenges in the security of DeFi protocols and the importance of being vigilant about one’s private keys and ensuring proper storage and protection.

The compromise of private keys at OracleSwap has caused concern among the DeFi community, who are well aware of the risks associated with decentralized finance. However, it is also an opportunity for the industry to come together and work towards solutions that can improve the security of DeFi protocols for everyone.

With nearly 40 FTSO providers on the Flare Network, according to FlareMetrics data, users have a wide range of options to choose from when it comes to delegating their tokens and earning rewards.

Disclaimer
BeInCrypto has reached out to company or individual involved in the story to get an official statement about the recent developments, but it has yet to hear back.