- Avalanche’s daily transaction count hit 1.2 million in the last 24 hours, the highest in four months.
- Stars Arena was the highest ranked dApp on the Avalanche network in terms of users and transactions.
Barely a week since launch, Avalanche [AVAX]-based decentralized social app Stars Arena has become the victim of an exploit that could have possibly siphoned millions of funds.
Read AVAX’s Price Prediction 2023-24
An X user who goes by the pseudonym lilitch.eth, made a startling revelation about the state of the SocialFi platform which has grabbed considerable interest since its debut last week.
What was the controversy about?
Stars Arena allows users to buy and sell shares of popular X profiles and profit from their social value. The shares could be purchased by using Avalanche’s native token AVAX.
The X user claimed that more than $1 million have been drained out of the platform because of a smart contract vulnerability. Exploiting this, the attackers could sell 0 shares and still get AVAX in their wallet.
Barely three hours after the disclosure, Stars Arena admitted that the exploit took place. However, in a big relief to the thousands of Stars Arena users, the vulnerability was fixed.
The platform labeled the attack as a hostile attempt by monopolistic forces to undermine a new entrant to the market. It added that exploiters spent $5 in gas fees to drain $1 in TVL.
Interestingly, a lot of people used the same argument to dispute lilitch.eth’s claims.
Popular on-chain researcher Emperor Osmo responded by adding a snippet of another user who called the exploit “useless” to any hacker, simply because the cost to execute the hack was 5x more than the eventual hacked amount.
While not in unequivocal terms, Stars Arena’s allegations of market monopoly pointed fingers at Friend.tech, the protocol that ignited the SocialFi revolution. Interestingly, both Friend.tech and Stars Arena seemed nearly identical in concept and operation.
How much are 1, 10, and 100 AVAXs worth today?
Immediate impact on Stars Arena’s fundamentals
Stars Arena has been the highest ranked decentralized app (dApp) on the Avalanche network, single-handedly propelling the chain’s network activity.
However, the latest FUD applied brakes on its march. Transactions count, volume, and user activity experienced a dramatic slide in the last 24 hours, as per DappRadar.
Source: DappRadar
