PegNet miners increased their balances from $ 11 to $ 6.7 million, but could not withdraw funds

Through a series of manipulations, a group of miners on the decentralized stablecoin network PegNet has increased their balancestheir wallets up to $ 6.7 million from an initial $ 11. However, due to the peculiarities of the system, they were not able to withdraw funds, having destroyed the received coins, CoinDesk writes.

According to the PegNet developer under a pseudonymWhoSoup, at about 05:00 UTC on Tuesday, April 21, four miners took possession of 70% of the computing power of the network and transmitted data, due to which the rate of the pJPY stablecoin linked to the Japanese yen increased many times. After that, they converted pJPY into dollar-based pUSD stablecoins and tried to sell them on various exchanges.

PegNet is a decentralized networkbased on the Factom protocol, users of which can trade stablecoins tied to 32 different assets. Also on the platform are exchange goods, such as gold, and other cryptocurrencies, including Bitcoin and Ethereum.

For pricing stablecoins PegNetuses data transmitted by miners. They add 50 data points to each block, 25 of which, the system that rejects the most differing from the average value.

In the indicated incident, miners actually carried out an attack of 51%: instead of 25, they provided 35 data points. The attack lasted about 20 minutes and, apparently, did not affect other users.

Chairman of Factom Inc. and one of the key figures in the PegNet system, David Johnston explained that attackers could only transmit price data and did not control the transactions and conversions of other users. In addition, due to the fact that the protocol does not allow fast conversions, the attackers were also unable to transfer most of the received pUSD to their own cryptocurrency of the PEG system.

As a result, they got in touch with representativesPegNet, saying that they just wanted to test the network for stability, identify possible vulnerabilities and warn developers about them. They destroyed the received stablecoins on their own, sending them the same day to the address for burning.

According to Johnston, to protect against such attacksin the future, developers will review oracle mechanisms on the PegNet network. Nevertheless, he acknowledged that with the increase in the value of the assets stored in the protocol, attempts to crack it will become more sophisticated.

Recall earlier in the attack onDeForce protocol dForce unknown attacker stole $ 25 million in various cryptocurrencies. However, after a few days, he, faced with the threat of exposure, returned all the funds.