Foundation Asset Token Protocol loses $1.7M due to private key leak
Grandbase (GB), the real-world asset tokenization protocol that runs on Coinbase's home layer-2 blockchain, suffered a $1.7 million loss after a private key compromise.
“On April 15th 03:01:27 AM +UTC, an exploit occurred on our contract,” wrote an administrator on the protocol's Telegram chat. “For this particular reason, we urge all members of our community to stay away from this contract. It's not safe anymore.”
According to blockchain analytics firm PeckShield, the private key breach stole $1.7 million in tokens from the liquidity pools, which were converted to Ether (ETH) on-chain and sent to external addresses. Similarly, the protocol's native token lost 99% of its value in the last 24 hours due to the crash.
“This token is no longer secure and you should not exchange or communicate with it, stay safe. We will notify you as soon as possible on the next step,” Grandbase Telegram admin said.
According to a series of analyzes by blockchain analytics firm CertK, the hacker was able to take control of Grand Base's deployment contracts, and even did so without permission before issuing GB tokens.
A subsequent post from Grand Base staff says that developers have “traced all of the hacker's wallets” and are awaiting the next step. “We are in talks with the CEXs to block any money he moves,” added Grand Base staff.
Users were not surprised by Monday's hack news.
“I feel so sorry for everyone involved here,” one user wrote in the Grand Base Telegram chat. “Please don't lose any more money here. Leave this and don't put one more dollar into this thing no matter what.”
“There are hidden loopholes in this contract,” said another user. “The overall balance doesn't show any changes and it's hidden gaps. Do you know it was intentional by Dave?” Before the attack, Grandbase had a maximum GB token cap of 50 million.
The Grandbase token protocol was launched less than five months ago. It allowed users to mint real-world assets in the form of ERC-20 tokens, and the tokenized assets offered cash to earn rewards.
Related: This platform aims to make seamless RWA tokenization possible.
