Acala Network Exploited, Losses $1.2B

Acala, which is a decentralized finance network, has been attacked by hackers. The official Twitter account of Acala Network has confirmed that there is some configuration issue related to Honzon protocol. Acala is the first project built on Substrate.

Honzon protocol is one of the two protocols used by Acala, the other one is Homa. Honzon protocol is responsible for the liquidity of aUSD and its configuration issue has badly affected the stablecoin. Hanzon protocol is inspired by MakerDAO and often regarded as the MakerDAO of Polkadot.

aUSD Affected by the Attack

aUSD, which is the stablecoin of Polkadot, has been greatly affected by this news. Its price has depreciated and now it is being traded at $0.0135 as per Coinmarketcap. The hackers have issued aUSD worth $1.2 billion. Acala is a stablecoin of Polkadot and Kusama and pegged by US dollar. Its price falling so much down is a serious worry for its holders. Noticing the extent of the attack, Acala network immediately arranged a voting session and passed the vote to halt all operations.

According to Acala Network tweet, they are investigating the attack to check the intensity of the attack and loss. Mitigation has also been mentioned in the tweet which means that users might not have to face any loss. The network will report back once the attack is tackled and hopefully the cause of the problem will also be uncovered.

Acala and Astar Network to Collaborate

A few days earlier, Polkadot had announced that Acala and Astar network will join hands to expand the Polkadot DeFi ecosystem. By combining forces together, they will develop various new cross-chains and liquidity pools. Astar will link Polkadot network to layer-1 blockchains such as Ethereum and Cosmos. In addition, it will resolve the issue of lack of blockchain interoperability and provide extended support for DApps development using EVM.

Furthermore, it will enable the users to use each other’s DApp ecosystems. Integrating Acala assets into other ecosystem DApps with ACA and aUSD will strengthen the connection between Acala and Astar networks.