Tuesday, December 6, 2022

Beanstalk Farms Offered A Plea To Hackers Of $76M Exploit

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Beanstalk Farms offered a plea deal to the hackers that attacked the company out of $76 million as we reported recently in our crypto news.

Beanstalk Farms offered a plea deal to the attackers and noted their plans for the future if the plea is unsuccessful. The company is a credit-based stabelcoin protocol that recently got exploited for $76 million in crypto and offered a bounty of 10% if the attackers return the funds. The offer was posted on the company’s Twitter profile and sent to the attackers via an on-chain message the next day. It proposed that the exploiters return 90% of the stolen funds to the multi-sig wallet of the platform.

In return, the exploiters will be allowed to keep a 10% cut which is a deal offered by the platform, or reward the individuals for reporting security exploits and vulnerabilities. The $76 million exploits were thought to be around $182 million but were not considered to be a hack as the smart contracts and governance procedures used to carry out the transfer. During a recent podcast, Beanstalk founders Benjamin Weintraub, Michael Montoya, and Brendan Sanderson admitted that the flaws in the design will lead to its undoing and a statement affirming that a preivous issue with the Beanstalk governance process was the mechanism used for the exploit.

The statement added that it shut off the protocol governance and paused the platform while preparing a strategy to launch a new plan forward. Spokesperson Weintraub returned to the podcast to discuss a new path forward for the company that includes some sort of fundraising:

“Let’s start with what’s the problem. Beanstalk had something like $76 million stolen from it yesterday. Now, it needs to recoup as much of that money as possible. It doesn’t need to recoup all of that money.”

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He also noted a few possibilities to raise the required funds if the exploiter fails to return the funds like offering a new token or slashing the users’ token holdings. Weintraub admitted that the specific structure to raise capital is much in the air but remained optimistic about the protocol’s survival rate:

“From our perspective, Beanstalk isn’t going anywhere. Beanstalk Farms isn’t going anywhere. The real question is how much of the $76 million Beanstalk is able to crowdsource. This isn’t the worst place to be in, guys.”

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