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[SITUATION] · [QUIET] · [TECHNOLOGY]

3 clusters · 20 sources · 27 days · First seen · Last updated

Harmony Protocol exploit and proposed Layer 1 sunset

Overview

The Harmony Protocol experienced a major security exploit involving the unauthorized minting of approximately 4 billion ONE tokens, representing roughly 26% of the total circulating supply. The exploit, which reportedly utilized empty network blocks, caused the price of ONE to crash by 30% to 50% as billions of tokens were transferred to exchanges.

In response, the Harmony team issued an emergency validator patch, paused its bridge, and initiated a blockchain rollback to a checkpoint from August 11. This rollback was designed to discard over 109,000 regular transactions and 315 staking transactions, as the team determined that selectively restoring transactions was unsafe. Preliminary investigations suggest the exploit targeted Harmony’s legacy consensus verification code and native cross-shard accounting.

Following these security challenges, Harmony has proposed sunsetting its seven-year-old Layer 1 blockchain and migrating the ONE token to the Ethereum network as an ERC-20 token. The project intends to pivot its focus toward a generative AI-driven video initiative called the ‘Remix Economy for AI Video.’ The proposal includes taking a final network snapshot to airdrop new tokens to corresponding Ethereum addresses. To facilitate the transition, Harmony has established a $1.372 million compensation pool for validators and delegators who comply with the shutdown process. The proposal remains non-binding and subject to governance procedures.

Entities

Harmony · Juiceberg · ONE · Harmony Protocol · Lazarus Group

Timeline

  1. 10 days ago

    [TECHNOLOGY] 5 sources
    Harmony proposes sunsetting Layer 1 blockchain and migrating ONE token to Ethereum

    Harmony proposes sunsetting its Layer 1 blockchain and migrating the ONE token to Ethereum to focus on a new AI-driven video economy following recent security exploits.

  2. about 1 month ago

    [TECHNOLOGY] 7 sources
    Harmony plans blockchain rollback following 4 billion ONE token exploit

    Harmony plans to roll back its blockchain to August 11 to mitigate an exploit that unauthorizedly minted 4 billion ONE tokens, a move that will discard over 109,000 transactions.

  3. about 1 month ago

    [TECHNOLOGY] 9 sources
    Harmony Protocol investigates unauthorized minting of 4 billion ONE tokens

    Harmony Protocol is investigating an exploit where approximately 4 billion unauthorized ONE tokens were minted, causing a massive price crash of up to 50% and prompting discussions of a blockchain rollback.

Sources

abmedia.io · alexewerlof.medium.com · bitcoinethereumnews.com · blockcast.it · blocktempo.com · btcmanager.com · coincu.com · coinpaper.com · cointelegraph.com · crypto.news · cryptopolitan.com · cryptoslate.com · detlionblood32.wordpress.com · en.coin-turk.com · flagthis.com · journalducoin.com · kansrijk.nl · news.bitcoin.com · newsbit.nl · susuzlar.com

This summary has been updated 1 time: see revision history