According to Coinglass, the crypto market witnessed more than $1.04 billion in liquidations during this period. Of this, a BNB position on the Venus lending protocol belonging to the perpetrator of the BSC bridge $560M hack was liquidated.
The BSC Bridge Hack: Understanding One of Crypto’s Biggest Exploits
The BSC brdige hack in October 2022 was one of the biggest exploits in crypto and DeFi history, with the hacker stealing nearly $593 million in BNB. But the story didn’t end there as the hacker tried to launder as much money as they could.
After the attack, the hacker deposited 900,000 BNB worth $200 million on Venus as collateral to borrow $150 million worth of stablecoins. With more than $598.25 million in TVL, the Venus protocol is the second-largest DeFi protocol on the Binance Smart Chain.
According to DeFi researcher Ignas, the position was the “single largest potential liquidation in all #DeFi that cannot be closed.” This is because, while the BNB Chain was halted and the network upgrade after the exploit, the ecosystem was put at risk, as liquidation of such an amount could lead to a further plummet in the price of BNB.
As a result, the Venus DAO voted to whitelist BNB Chain as the sole liquidator of the hacker’s address in case of a margin call. Notably, a drop in the price of BNB to $220 would see the hacker’s collateral liquidated.
Now, with the price of the token experiencing a selloff in the past few days, the team has chosen to manually liquidate the position to reduce the impact of a margin call on the BSC ecosystem.
On-chain data from PeckShieldAlert shows that the position has been liquidated for 5.6 million BNB tokens worth $52.3 million, a fraction of the total position.
Following today’s market movement, the BNB Bridge exploiter account was made healthy as promised by @BNBCHAIN using whitelisted liquidation without any resulting shortfall or further impact to $bnb https://t.co/TGZ7nbiDPN
— Venus Protocol (@VenusProtocol) August 18, 2023
What’s Next For BNB?
Since that time, the price of BNB has dropped below $220. Now, the cryptocurrency is trading at $215.00, reflecting a drop of 10.76% in the past 7 days.
Although the token has had a tough time with its price in the past few months as the industry awaits the outcome of the SEC’s lawsuit against Binance.US, the toke still manages to stand strong than most would expect.
At this time, BNB has a market cap of $33 billion, making it the fourth-largest cryptocurrency.
Token price falls below hacker's liquidation price | Source: BNBUSDT on Tradingview.com
Featured image from Binance, chart from Tradingview.com