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BurgerSwap Explains $7.2 Million Flash Loan Attack in Post-Mortem

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BurgerSwap Explains $7.2 Million Flash Loan Attack in Post-Mortem

In just 14 transactions, a flash loan attack drained $7.2 million from the wallets of BurgerSwap, a decentralized exchange based on the Binance Smart Chain.

Flash loans are instantaneous crypto loans. A borrower can do whatever they like with the funds, so long as they repay the loan within the same transaction.

BurgerSwap conducted a post-mortem investigation with blockchain security firm PeckShield to work out how flash loans manipulated the protocol.

They discovered that, at 9PM UTC yesterday, an attacker deployed a fake BEP-20 token—a generic token standard on the Binance Smart Chain—and used it to form a trading pair with BURGER, BurgerSwap’s native token.

Later, the attacker executed a code to manipulate the reserve supply of that trading pair, causing the price of $BURGER to move drastically. The attacker capitalized on that phony price difference through flash loans and continued to scheme their way through the exchange.

The attacker eventually made off with $1.6 million in Wrapped BNB, $6,800 in ETH), $3.2 million of BURGER coin, $1 million of xBURGER, a synthetic version of BURGER, 95,000 ROCKS ($152,000), $22,000 of Binance’s US dollar-pegged stablecoin, BUSD, and a further $1.4 million of USD stablecoin Tether.

“We understand what the community cares about the most. Detailed compensation plan is on the way”, BurgerSwap tweeted today. “All we [are] asking for is some time.”

BurgerSwap launched in September 2020 on the Binance Smart Chain (BSC), a popular decentralized finance (DeFi) alternative to the ETH network.

The BurgerSwap attack comes a week after PancakeBunny, another Binance Smart Chain-hosted DEX, fell victim to a similar attack and lost $45 million in customer funds.

The views and opinions expressed by the author are for informational purposes only and do not constitute financial, investment, or other advice.


All content in this article is for informational purposes only and in no way serves as investment advice. Investing in cryptocurrencies, commodities and stocks is very risky and can lead to capital losses.

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