Another Polygon Yield Farm Crashes to Zero After Exploit

Another Polygon Yield Farm Crashes to Zero After Exploit

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Key Takeaways PolyYeld Finance’s YELD token has crashed to zero after attackers exploited a vulnerability to mint nearly 4.9 trillion tokens.

The attack targeted PolyYeld’s Masterchef pool, which contained xYELD tokens.

Several other yield farming projects on Polygon have suffered similar attacks in recent months.

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PolyYeld Finance was exploited today, leading to a price collapse of its native token.

Attacker Exploits PolyYeld Vulnerability

PolyYeld Finance’s native token has collapsed to zero after attackers took advantage of a vulnerability to mint an excess supply of tokens.

According to security firm PeckShield, the attacker successfully minted nearly 4.9 trillion YELD tokens. They sold a portion of them for roughly 123 ETH, worth about $250,000 at today’s prices.

The attacker exploited a vulnerability in the PolyYeld Masterchef contract, a type of contract used by yield farms to distribute rewards. The attack targeted a Masterchef pool containing another token called xYELD, which generated passive income for holders by charging fees on each transaction and distributing them as YELD rewards.

In a note shared on Telegram, the PolyYeld team claimed that its Masterchef contract could not support xYELD’s reward distribution system, which allowed the attack to take place. They said:

“[The] xYELD token contains a transfer tax which was added to Masterchef, which unfortunately could not support tokens with transfer taxes.”

The lack of Masterchef support meant attackers could mint free reward tokens by shrinking the value of the xYELD liquidity pool.

The Masterchef contract was invented for distributing rewards for liquidity pool tokens. But more recently, yield farms on Binance Smart Chain and Polygon have started using master contracts for single asset tokens or “transfer fee tokens” like xYELD.

Security firm PeckShield explained that a deflationary token such as xYELD charges a fee on its transfers. With repeated deposits and withdrawals, the xYELD balance was shrunk down maliciously up to 1 WEI, the smallest denomination of 1 Polygon.

A Masterchef contract estimates rewards by dividing the pool value by the value of tokens staked, meaning if the pool value is reduced, it can dramatically inflate the rewards. Xuxian Jiang, founder and CEO of PeckShield, told CryptoBriefing:

“By repeated deposits and withdraws with the MasterChef, the attacker frequently triggers the tax collection. This gradually reduces the xYELD balance of MasterChef to 1 WEI, which led to actual exploitation.”

As the attackers minted 4.9 trillion tokens and sold a portion of them, the market was immediately flooded, leading the price to collapse to zero. According to PolyYeld’s website, the maximum supply was intended to be 62,100 YELD tokens.

Since the attack, the price of YELD has crashed from $25 to $0 in the space of a day. Meanwhile, xYELD is down from $100 to around $7, as per Dex Guru.

In the note posted in the PolyYeld Telegram group, the team asked users to unstake their funds. It added that it was considering a compensation plan and promised a report in the coming days. Meanwhile, the Telegram group remains muted along with other channels of communication.

This is yet another security instance involving Polygon-based yield farms. In recent months, projects such as Iron Finance, PolyWhale, and SafeDollar were targeted in a similar fashion, wherein attackers hyperinflated the token supply and caused a price collapse.

PolyYeld held more than $20 million in total value locked as of last week.

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Take a look inside this underground crypto mining farm in Ukraine with its 3,800 PlayStations and 5,000 computers

Ukraine police last week seized around 9,000 games consoles and computers in an illegal crypto mine.

The mine was stealing as much as $259,300 in electricity each month, investigators said.

Police said it was the largest underground crypto mine to have been discovered in Ukraine.

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A huge underground cryptocurrency mining operation has been busted by Ukraine police for allegedly stealing electricity from the grid.

Police said they’d seized 5,000 computers and 3,800 games consoles that were being used in the illegal mine, the largest discovered in the country.

The mine, in the city of Vinnytsia, near Kyiv, stole as much as $259,300 in electricity each month, the Security Service of Ukraine said. To conceal the theft, the operators of the mine used electricity meters that did not reflect their actual energy consumption, officials said.

“Such illegal activity could lead to power surges and left people without electricity,” the security service said.

Police said that criminal proceedings had begun over the theft of water, electricity, and thermal energy. The mine was run by residents of Kyiv and Vinnytsia, a city about three hours outside the capital, police said.

Gaming consoles in the crypto mine in a photo released by officials. Security Service of Ukraine

Photos released by state investigators show a cavernous room filled wall-to-wall with metal racks of neatly lined-up computers and Sony Playstation consoles.

Along with the computers and consoles, officials said they also seized more than 500 graphic cards, 50 processors, and documentation on the site’s electricity consumption. They also took notebooks, phones, and flash drives, according to the press statement.

Cryptocurrency Booming Among Kenyan Farmers

KILIFI, KENYA - Cryptocurrencies make headlines for shaking up the financial world, but they are also gaining ground in less developed countries. In Kenya, an American economist, who introduced blockchain technology for low-income urban customers, has extended the cashless system to the countryside.

On a lush green farm in Kilifi on Kenya’s tropical Indian Ocean coast, 26-year-old farmer Emmanuel Kahindi is harvesting tomatoes and other vegetables. He is using Kenya’s cryptocurrency, Sarafu, to sell his vegetables, and to buy supplies without having to use any cash.

Sarafu helped me a lot, he said, especially because it makes me save my money, my Kenyan currency. He said he uses Sarafu to purchase things for the garden like seeds and fertilizer.

Sarafu coins work like vouchers that can be exchanged for goods or services of other users of the currency. Anyone with a Kenyan mobile phone line can enroll. Users are given 50 Sarafu for free. After that, they earn coins by selling a product or service to another user.

Sarafu is what’s known as a community inclusion currency, or CIC, allowing people to give or take credit without having to deposit Kenyan shillings or other currency in a bank.

It was created by Will Ruddick, an American economist through his Kenyan nonprofit, Grassroots Economics. He recently introduced it to rural areas like Kilifi.

“I think that’s where there is the most chronic lack of national currency. So, I think what’s happening, we’re filling a gap. People say look, the national ledger system, the national currency it is not available for us. We can’t measure our trade in this thing,” said Ruddick.

Kahindi moved with his harvest to a nearby restaurant in Kilifi. There he offers his vegetables for selling and gets Sarafu in a return. The owner is Giataari Mwangi and he said he is happy with it.

“Sarafu is good because it allows us to get our farm produce straight from local neighborhood farms and put it on our plate and serve it to our customers and they are able to pay us with Sarafu,” he said.

Bitange Ndemo is a senior lecturer at the University of Nairobi. He said such community-focused cryptocurrencies have a potential to expand beyond Kenya and in other parts of Africa.

He said that cryptocurrencies give communities an option to monetize resources in a way that they cannot do with cash, pointing at the cobalt mines in the Democratic Republic of Congo as a potential example.

“Nothing stops them from a cobalt coin based on the reserves they have in terms of cobalt. The country then can then raise sufficient resources to develop the country,” said Ndemo.

In Kenya, the coins will be based on the agriculture production across the nation and here in Kilifi.

For Emmanuel, it is time to relax after work. He is now seated in the restaurant and is using Sarafu to enjoy a well-deserved meal.