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Solana Meme Coin Platform Pump.Fun Mined for $1.9 Million, Promises to Refund Users
May 17, 2024 11:27 am | 2 minutes reading
Popular Solana (CRYPTO: SUN) based meme currency platform Bomb.Fun got a scare on Thursday after a former employee exploited a vulnerability to manipulate the platform system.
What happened: The incident, which saw the perpetrator embezzle around $1.9 million in SOL tokens, sent shockwaves through the platform’s user base.
“We are aware that bond curve contracts have been compromised and are investigating the matter,” Pump.Fun announced on Twitter amid the chaos. Trading was immediately halted, leaving users in the dark about how the situation would unfold.
Exploration explained
Fortunately, Pump.Fun released a detailed post-mortem explaining the exploit. In short, a former employee with privileged access leveraged “flash loans” from a Solana lending protocol.
These loans, essentially short-term loans, allowed the individual to:
- Lend SOL tokens.
- Use borrowed SOL to purchase large quantities of specific meme coins on Pump.Fun, raising their prices to 100% on the platform’s bonding curve system.
- Gain access to the liquidity pool associated with these coins upon reaching 100%.
- Repay the instant loans, essentially leaving Pump.Fun out of pocket for the stolen SOL.
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Fast action and guarantee
Fortunately, the exploit only affected about $1.9 million of the platform’s total $45 million liquidity pool. Pump.Fun reacted quickly, redistributing the contracts and resuming trading with 0% fees for the next week.
The platform has also committed to making users whole for the affected coins. See how:
- Coins that reach 100% during the exploration window will be listed on Raydium, a decentralized exchange, with at least the same amount of liquidity as they had before the incident.
- The platform will waive trading fees for the next seven days.
“We have been working with some of the most highly regarded security professionals in the industry to not only minimize the impact of the situation, but to ensure this never happens in the future,” Pump.Fun assured its users, thanking them for their trust.
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