Decoding Ocean BNO’s $500k Exploit

Summary

On the 18th of July 2023, Ocean BNO on the Binance Smart Chain was attacked. The attack was made possible by a smart contract vulnerability. And around $500k worth of BNO tokens was swapped to BUSD by the attacker.

About Project

Ocean Nft is a blockchain-based NFT MarketPlace. For more information, check out their website.

Vulnerability Analysis & Impact

On-Chain Details

Attacker Address: 0xA6566574eDC60D7B2AdbacEdB71D5142cf2677fB

Victim Contract: 0xD138b9a58D3e5f4be1CD5eC90B66310e241C13CD

Attack Transaction: 0x33fed54de490797b99b2fc7a159e43af57e9e6bdefc2c2d052dc814cfe0096b9

The Root Cause

• The root cause for the exploit was an incorrect record of rewards for NFT and ERC20 tokens.

• Withdrawing of staked NFT didn’t happen during the execution of Emergency Withdrawl, and rewardDebt was set to 0.

• This resulted in NFT becoming reclaimable even when the stake was cancelled

• The attacker was able to exploit emergencyWithdraw() function to clear the user’s reward debt to zero and make a profit for himself.

Attack Process

• Firstly, the attacker stakes NFTs and BNO tokens through stakedNFT() and pledge() functions.

• Then the attacker called emergencyWithdraw function

• This allows him to unstake NFT while simultaneously getting the rewards.

• The process was repeated several times to increase profit.

• Finally, the exploiter swapped the rewards into BUSD.

Flow of Funds

Most of the funds were sent to this address – 0xdc109426972ae14d5b3d7e91b47d42ff1fd3c8cc

For more details, check here.

Attacker’s Wallets

Here is a snippet of the attacker’s wallet. Check the complete details here.

After the Exploit

• The Project has not acknowledged the attack at the time of writing this postmortem.

Incident Timelines

Jul-18-2023 12:57:13 AM +UTC) – The attack started.

Jul-18-2023 12:57:13 AM +UTC – Exploiter swapped his profit for $504k BUSD

Price Impact

The price of the BNO token dropped by 99% from $4.0 to $0.04 immediately following the attack.

How could they have prevented the Exploit?

When dealing with a contract that accommodates multiple token standards, it is essential to ensure that the business logic and mathematical operations for each token are accounted for and managed independently.

To guarantee the accuracy and functionality of the code, it is crucial to write comprehensive test cases that thoroughly cover all potential business scenarios.

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