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YZi Labs-backed BounceBit has decided to permanently cease operations on its first-layer blockchain network, BounceBit Chain, after a protocol-level authorization vulnerability led to the unauthorized transfer of 286.5 million BB tokens.
According to the project team, the attacker exploited a vulnerability in the authorization mechanism of the Evmos-based BounceBit Chain. Through this vulnerability, a total of 286.5 million BB tokens were transferred without authorization from nine accounts on the mainnet.
BounceBit stated that no private keys or user wallets were compromised during the incident. The company also reported that its CeDeFi, Prime, and real-world asset-focused RWA products were unaffected by the security incident.
BounceBit Chain to be permanently shut down
Following the incident, it was decided that BounceBit Chain would not be reactivated and the network would be permanently shut down. The BB token will be reissued on BNB Chain under the BEP-20 standard, based on a network snapshot taken before the attack.
The new token distribution will be based on balances prior to the attack. The 286.5 million BB transferred by the attacker will not be carried over to the new contract and will not be valid in the re-issued token offering.
BounceBit is expected to release a detailed transition plan outlining how users will exchange tokens, which exchanges will support the migration, and when the new contract will be rolled out.
BB price rises more than 12% despite news
Despite the announcement that the network would be permanently shut down and a security vulnerability affecting hundreds of millions of tokens was discovered, it is noteworthy that the BB price gained over 12% today.
BounceBit raised $6 million in a seed funding round in 2024, led by Blockchain Capital and Breyer Capital. OKX Ventures and HTX Ventures also participated in the round, and the project later received a separate investment from Binance Labs. Binance Labs subsequently changed its name to YZi Labs.
*This is not investment advice.
Source: cryptonews.net