Top Crypto News Today: Optimism’s BitBTC bridge saved from exploit but Bitcoin falls below $19,000

Optimism’s BitBTC bridge saved from potential exploit!

In a major close save thanks to a sharp-eyed Twitter user, the cross-chain bridge between BitBTC and Optimism was saved from a potentially costly exploit. This Twitter user was none other than the tech lead from another popular L2 called Arbitrum on the 18th of October, calling the bridge ‘trivially vulnerable’.

He had been trying to reach out to the team behind the project to repair the bug in the system, even tried messaging them on their Telegram channels but to no avail when he decided to put it up on Twitter.

BitBTC's Optimism bridge is trivially vulnerable. Their team has ignored my messages, so I'm going to publish the critical exploit here. 🧵https://t.co/onyN9SzBjt

— Lee Bousfield (plasmapower.eth) (@PlasmaPower0) October 18, 2022

This was a custom cross-chain bridge, that offered a ramp for users to sent assets between Ethereum layer-2 network, Optimism and BitAnt’s decentralised finance (DeFi) ecosystem. This is a major save because BitAnt’s DeFi ecosystem included a plethora of services ranging from yield farming, NFTs, Swaps and the BitBTC token – which represents a millionth of a BTC token.

According to Bousfield, the Twitter user who pointed out the bug explained that the bug could be exploited easily by a malicious attacker to mint fake tokens on one side of the bridge and swap them for real ones on the other side. He explained that the Optimism L2 side of the bridge lets you withdraw any token, and it allows that token to pick the L1 token address passed to the L1 side of the bridge.

However, the L1 bridge completely ignores what the L2 token was, and just goes ahead and mints the arbitrary L1 token! That means an attacker could deploy their own token on Optimism, give themselves all the supply, and set that token's l1Token to the real BitBTC L1 address. pic.twitter.com/vbTFxa8swh

— Lee Bousfield (plasmapower.eth) (@PlasmaPower0) October 18, 2022

This became so mission critical that the actual hack predicted by Bousfield actually happened on the cross-chain bridge where an attacker tried to siphon out 200 billion fake BitBTC tokens on the L2 chain to exchange them for real tokens on the L1 side.

It's happening 👀
An attacker is withdrawing 200 billion fake BitBTC from Optimism
The BitBTC team has 7 days to fix it on L1!https://t.co/bxLq370xWE

— Lee Bousfield (plasmapower.eth) (@PlasmaPower0) October 18, 2022

However, eventually, the incident finally came to the attention of the developer team behind the project and the bug was quashed. No funds were lost thanks to the fact that the network code required 7 days to complete the total transaction in which the team responded quickly and squashed the bug.

The BitBTC vulnerability has been patched! 🎉

The attacks will now fail when they arrive on L1. Thanks everyone for making noise and helping get this fixed 😃https://t.co/bTkrwFF4En https://t.co/OOCXhhS5bR

— Lee Bousfield (plasmapower.eth) (@PlasmaPower0) October 19, 2022

However, despite this close call – it is well known that the technology and security behind bridges is still in the development mode. Just this year back in February, we saw Wormhole’s $375 million exploit which was quickly followed up by the $625 million exploit of Axie Infinity’s Ronin bridge next month. As recently as in August, the Nomad bridge was also attacked and $190 million worth of funds were lost.

Related: Top Altcoins 2022

Bitcoin Price touch sub-$19,000 levels

BTC/USD | Source: Tradingview

As is evident from the chart above, Bitcoin price suffered a significant fall since the news of the bug first came out. BTC price has shed over 2% in the interim and as of writing, hit a low of $18,923 as of writing. Bitcoin is also trading very close to the lowest points of the year-to-date timeframe and has been here for quite some time. It had tried to breakdown below the $19,000 mark but the bulls have never let prices sustain below it for too long.

BTC price is currently trading well below the 200 and just below the 50 day moving averages and is below any and all other significant price levels. The Relative Strength Index is also below 45 as of writing which wouldn’t be able to provide any major bullish support either. So overall things seem to be moderately bearish as of now which can quickly escalate if a sub-$19,000 breakdown sustains for long.

Read more: Bitcoin Price Prediction

Prices as on 20th October, 2022.