Hedera suspends the wallet and app access due to a possible exploit

Hedera is shutting down access to most services, as announced in a tweet on March 9.

Hedera blocks wallet, app access

Hedera said it will shut down network proxies on its main network while it investigates irregularities in its smart contracts. This action means that wallets, decentralized exchanges and decentralized applications and centralized exchanges will not be usable.

The project said its main network remains operational and is reaching consensus on new blocks. Instead, the web is similarly inaccessible to most users. The project said it will re-enable access and proxies when the issue is resolved.

Hedera said it is taking this action “in abundance of consumer caution.” The draft does not state whether any funds were lost or stolen.

The decision has already drawn criticism from users who have questioned the project’s commitment to decentralization. The fact that Hedera used proxies seemingly alone suggests that only a few parties have control over the network.

Hedera fully controlled the proxies when they were launched in 2020. However, he also said he plans to give control to council members at a later date.

The solution is the result of previous developments

Heather confirmed that it was are experiencing problems with the smart contract earlier on March 9. The Hashport bridge service also paused its services to help contain the problem.

Hedera provided little information on the nature of the problem. However, independent blockchain researcher Ignas reported that the issue is related to the smart contract decompile process and said it specifically affects the Hedera Token Service (HTS). This means that Liquidity Provider (LP) tokens and packaged tokens are affected.

Ignas cites Justin Trollip, CEO of the Pangolin Exchange, as the original source of this information. Trollip said Hedera projects like Pangolin, SaucerSwap. Heliswap and others are also at risk. Trollip advised consumers to “take [their] funds now” ⁠— advice that was later echoed by Pangolin in an official capacity.

Hedra (HBAR) was down 6.2% in the 24 hours as of 12:45 PM UTC on March 10th. However, it outperformed Bitcoin, which was down 7.4% in 24 hours.

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