A decentralized exchange that runs on Coinbase’s Base network, LeetSwap, has made an announcement regarding the temporary suspension of trading on its platform in response to apprehensions over a potential exploit.
The LeetSwap team is currently working behind the scenes to address and resolve the threats promptly.
According to LeetSwap’s tweet on Tuesday, the decentralized exchange discovered possible issues with some of its liquidity pools. To be cautious, they decided to temporarily stop trading so they could thoroughly investigate the situation.
Following the announcement of the trading pause, LeetSwap mentioned that they are working with on-chain security experts to recover the locked liquidity and handle the situation effectively.
The exchange also added, “If you did not lock your liquidity you are free to remove it from the pools.”
However, the DEX did not provide detailed information about the reasons for pausing trading on their platform. Nonetheless, several blockchain experts have shared their opinions on the possible method of exploitation.
According to Igor Igamberdiev, the research head at algorithmic market maker Wintermute, the attacker may have taken advantage of an exposed smart contract function. This allowed them to manipulate the token’s price, making it possible to drain wrapped Ether from LeetSwap’s liquidity pools.
Igamberdiev further revealed that the potential exploit appeared to have resulted in the attacker gaining 342.5 ETH, an amount valued at over $630,000.
Another blockchain security firm, PeakShiled, highlighted that the root cause of the exploit lies in the exposed “LeetSwapV2Pair::_transferFeesSupportingTaxTokens(),” which was scarcely forked from a secure source.
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