What happened
On October 7, 2018 (UTC; 6pm Pacific on Saturday, October 6), an attacker drained 165.38 ETH, about $38,000, from SpankChain's payment channel contract on Ethereum using reentrancy. The attack also left about $4,000 of BOOTY tokens stuck in the contract. Of the stolen or stuck funds, 34.99 ETH and 1,271.88 BOOTY (about $9,300) belonged to users; the rest was SpankChain's.
SpankChain noticed the drain about a day later and took Spank.Live offline. It promised to reimburse users in full and to redeploy a patched contract. It said it had skipped a security audit for this contract after receiving quotes of $30,000 to $50,000.
Within days the attacker handed over the private key to an address holding the stolen funds and helped recover the stuck tokens. SpankChain paid a $5,000 bounty, bought the frozen BOOTY back for $4,000, and returned the 5.5 ETH the attacker had used to launch the attack.
Payment channel: 0xf91546835f756da0c10cfa0cda95b15577b84aa7. Attacker: 0xcf267ea3f1ebae3c29fea0a3253f94f3122c2199. Malicious contract: 0xc5918a927c4fb83fe99e30d6f66707f4b396900e. Attack tx: 0x21e9d20b57f6ae60dac23466c8395d47f42dc24628e5a31f224567a2b4effa88.
How it happened
- The attacker deployed a malicious contract posing as an ERC20 token, whose
transferfunction called back into the payment channel contract. - Using that fake token, the contract called
createChannel, opening a channel with an ETH deposit and a token balance. - It then called
LCOpenTimeout, which lets a user exit a channel the counterparty never joined by refunding the initial ETH and token deposits. LCOpenTimeoutsent the ETH and called the token'stransferbefore deleting the channel data, so the faketransferre-enteredLCOpenTimeoutwhile the balance was still recorded.- Each loop sent the attacker ETH equal to the channel balance again, until 165.38 ETH had been drained.
Protocol details
Evidence
- transaction Etherscan transaction 0x21e9d20b...effa88 etherscan.io
- analysis DeFiLlama defillama.com
- analysis We Got Spanked: What We Know So Far (SpankChain, Wayback copy) web.archive.org
- analysis SpankChain Hacker Returns Stolen Ethereum, Earns $9,000 Reward (CCN via Yahoo Finance) finance.yahoo.com
- analysis DeFiHackLabs SpankChain_exp.sol PoC raw.githubusercontent.com
Understand the attack patterns
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