KuCoin Identifies Inaccurate Information in Acala’s Community Proposal
Acala – one of the first Polkadot parachains – recently rolled out a yield-bearing liquidity pool for aUSD and a form of wrapped bitcoin, which contained a bug that was soon exploited by the hackers resulting in 1.2 billion aUSD being minted without collateral.
This week, the protocol launched a report detailing the exploit along with a proposal to recover billions of dollars worth of aUSD. But KuCoin has alleged that much of the important information related to the CEX in the report and the proposal is inaccurate.
Flawed Numbers
According to KuCoin’s latest statement, the total number of aUSD error mints sent to the exchange is 8.03 million, rather than 4.937 million, as detailed in the community proposal. It further noted that the total number of aUSD error mints trading on the exchange was incorrectly mentioned as 1 million instead of 5.33 million.
KuCoin said that if the current proposal with alleged flawed data has been executed, it means that more than 4.33 million aUSD tokens that were held by the token holders will be frozen and even burnt. The platform added that this may lead to “tremendous damage” to the Acala community as well as the price of the token.
It suggested the Acala team reconsider its community’s proposal and went on to add,
“Given the significant difference in the amount of aUSD error mints deemed necessary to re-collateralize, it is suggested that the Acala community reconsider the current proposal together with the Acala Foundation. In the interests of protecting users, KuCoin is willing to continue to provide support to the Acala community and the Acala Foundation. And with our joint efforts, we hope the incident can be resolved soon while ensuring that no innocent user suffers any loss.”
Acala Sparks Decentralization Debate
The exploit triggered a crash of Acala Network’s aUSD stablecoin that soon depegged by over 99%. In response, the team froze the erroneously minted tokens by placing the network in maintenance mode to protect users and the network from further damage. The move subsequently paused other features as well, including swaps, xcm (cross-chain communications on Polkadot), and the oracle pallet price feeds.
But this did not sit well with decentralized proponents, many of whom questioned how decentralized Acala really is if it could promptly freeze funds.
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OhNoRipple via https://www.ohnocrypto.com/ @Chayanika Deka, @Khareem Sudlow