The recent hack of the CoW Swap decentralized exchange (DEX) has once again brought attention to the security issues in the DeFi space.
The DeFi market has seen billions of dollars stolen in 2022, and 2023 has already seen several incidents, including this one where an attacker was able to siphon over $180,000 in funds from the platform.
The attacker used the GPv2Settlement contract and was able to trick the system into approving SwapGuard for DAI spending, and then used the SwapGuard to transfer the DAI from the GPv2Settlement.
The SwapGuard function reportedly allows anyone to make arbitrary function calls, making it possible for the attacker to steal the funds.
This marks yet another security breach in the DeFi space, which continues to be a prime target for attackers.
As DeFi gains more popularity, it is crucial that these platforms take necessary measures to improve their security protocols and protect their users’ funds.
In the meantime, the crypto community is once again reminded of the importance of due diligence and caution when investing in DeFi projects. While DeFi offers many exciting opportunities, it also comes with a higher level of risk.
CoW Swap is a new DEX that uses a combination of on-chain and off-chain transactions to execute orders.
The platform made headlines last year with its COW token airdrop, and more recently with the launch of “Surplus-Capturing” Limit Orders. While the platform has shown potential, the recent hack serves as a reminder of the inherent risks in the DeFi space.
As of yet, CoW Swap has not made an official statement on the incident. It remains to be seen what measures the platform will take to ensure the security of its users’ funds and prevent similar incidents from happening in the future.