Decentralized exchange (DEX) KiloEx has taken decisive steps to address the fallout from a significant security breach, during which $7.5 million was exploited due to a price oracle vulnerability. In an announcement made on April 24, the platform revealed its commitment to fully compensate traders and stakers who were negatively impacted by the incident, which led to a temporary shutdown of services in early April.
According to KiloEx, users who had open positions at the time the platform went offline will receive full compensation if they experienced a loss or missed profit opportunities. The platform emphasized, “Please close your position as soon as possible after the platform resumes. Compensation will be calculated based on the platform’s resume time.” This proactive compensation plan aims to restore confidence among KiloEx’s users.
For those engaged in staking through KiloEx’s Hybrid Vault, the news is even more promising. The DEX confirmed that the principal amounts and earnings of stakers remain unaffected by the exploit. In addition, KiloEx announced a bonus of 10% annual percentage yield (APY) for those who staked their funds before the service resumed. This measure is designed to reward loyal users who continued to support the platform during turbulent times.
The incident first came to light when KiloEx suspended its services on April 14, after detecting the exploit that resulted in the substantial financial loss. **Security firm PeckShield** investigated the breach and concluded that the attacker successfully exploited a permitted function, manipulating the system to create an opportunity for illegitimate profits. KiloEx initially offered a 10% bounty to the hacker as an incentive to return at least 90% of the stolen funds. Not long after, it was reported that the hacker returned the stolen amount, prompting KiloEx to withdraw legal actions and grant the hacker a 10% white hat bounty instead.
Despite the challenges faced in the aftermath of this security breach, KiloEx’s steps toward user compensation and additional incentives may serve as a blueprint for other DeFi platforms grappling with security issues. The DEX’s transparency and swift actions in the wake of the exploitation demonstrate a commitment to maintaining user trust, which can be crucial for future operations in the volatile crypto space.
As KiloEx navigates the aftermath of this hacking incident, it emphasizes the importance of security measures in the rapidly evolving DeFi landscape. Users are encouraged to remain vigilant and stay informed about the protective measures implemented by DEXs like KiloEx.
