Onyx Protocol, a decentralized finance (DeFi) platform, has recently fallen victim to a security breach, resulting in a loss of $2.1 million. This incident has raised concerns within the cryptocurrency community, highlighting the persistent vulnerabilities in the DeFi space.
The Breach and its Discovery
On November 1, 2023, Peckshield, a blockchain analysis and security team, brought attention to a suspicious transaction involving Onyx Protocol. The attack, executed using a "precision loss" bug and a flash loan, allowed the perpetrators to drain a substantial amount of ETH and ERC20 tokens from the platform.
Upon discovery, the news of the hack quickly spread across social media channels, alarming the cryptocurrency community. The breach not only compromised the platform's security but also raised questions about the overall safety of DeFi projects.
The Impact on Onyx Protocol and Investors
Following the attack, a fraction of the stolen crypto assets, which were originally from the cross-token liquidity market, were transferred to the ether mixing service Tornado Cash. This move aimed to obfuscate the transaction trail and make it difficult to trace the funds.
Interestingly, despite the security breach, the platform's native currency, onyxcoin (XCN), experienced only a slight decline of 0.8%. This relatively small decrease in value indicates that investors have not completely lost faith in the project and its potential for recovery.
However, the breach did have a significant impact on the total value locked (TVL) in the Onyx Protocol. Prior to the attack, the TVL stood at $2.88 million, but it plummeted to $557,253 after the breach. This sharp decline highlights the immediate consequences of such security incidents on the confidence of investors and the overall health of DeFi projects.
The Ongoing Concerns and Future of DeFi
The Onyx Protocol hack serves as a reminder of the vulnerabilities that persist in the DeFi space. While the decentralized nature of these platforms offers numerous benefits, it also exposes them to potential security breaches and exploits.
As the popularity of DeFi continues to grow, it is essential for developers and platform operators to prioritize security measures. Robust auditing processes, vulnerability assessments, and proactive security updates are crucial to mitigate the risks associated with DeFi platforms.
Furthermore, this incident highlights the need for increased awareness among users and investors. It is crucial to conduct thorough research and due diligence before engaging with any DeFi project. Understanding the risks and evaluating the security measures in place can help users make informed decisions and protect their investments.
Share Your Thoughts
What are your thoughts on the Onyx Protocol hack? Are you concerned about the security of DeFi platforms? Share your opinions and insights in the comments section below.
Frequently Asked Questions
How much is gold taxed under a Roth IRA
An investment account's tax rate is determined based upon its current value, rather than what you originally paid. If you invest $1,000 into a mutual fund, stock, or other investment account, then any gains are subjected tax.
You don't pay tax if you have the money in a traditional IRA/401k. Taxes are only charged on capital gains or dividends earned, which only apply to investments longer than one calendar year.
These accounts are subject to different rules depending on where you live. For example, in Maryland, you must take withdrawals within 60 days after reaching age 59 1/2 . In Massachusetts, you can wait until April 1st. New York is open until 70 1/2. To avoid any penalties, plan your retirement savings and take your distributions as early as possible.
Is buying gold a good retirement plan?
Although buying gold as an investment might not sound appealing at first, when you look at the average annual gold consumption worldwide, it is worth looking into.
The most popular form of investing in gold is through physical bullion bars. There are many ways to invest your gold. Research all options carefully and make an informed decision about what you desire from your investments.
For example, purchasing shares of companies that extract gold or mining equipment might be a better option if you aren't looking for a safe place to store your wealth. If you need cash flow to finance your investment, then gold stocks could be a good option.
You can also invest your money in exchange-traded fund (ETFs), which give you exposure to the gold price by holding securities related to gold. These ETFs usually include stocks of precious metals refiners or gold miners.
How can you withdraw from an IRA of Precious Metals?
First, determine if you would like to withdraw money directly from an IRA. Make sure you have enough cash in your account to cover any fees, penalties, or charges that may be associated with withdrawing money from an IRA.
An IRA is not the best option if you don't mind paying a penalty for early withdrawal. Instead, open a taxable brokerage. This option will require you to pay taxes on the amount that you withdraw.
Next, calculate how much money your IRA will allow you to withdraw. This calculation will depend on many factors including your age at the time of withdrawal, how long the account has been in your possession, and whether you plan to continue contributing towards your retirement plan.
Once you know what percentage of your total savings you'd like to convert into cash, you'll need to determine which type of IRA you want to use. Traditional IRAs permit you to withdraw your funds tax-free once you turn 59 1/2. Roth IRAs have income taxes upfront, but you can access the earnings later on without paying additional taxes.
Once these calculations have been completed you will need to open an account with a brokerage. A majority of brokers offer free signup bonuses, as well as other promotions, to get people to open accounts. To avoid unnecessary fees, however, try opening an account using a debit card rather than a credit card.
When you do finally decide to withdraw from your precious metallic IRA, you will need a safe space where you can safely store your coins. Some storage facilities can accept bullion bar, while others require you buy individual coins. Either way, you'll need to weigh the pros and cons of each before choosing one.
Bullion bars are easier to store than individual coins. However, each coin will need to be counted individually. You can track their value by keeping individual coins.
Some people like to keep their coins in vaults. Others prefer to store them in a safe deposit box. Whatever method you choose to store your bullion, you should ensure it is safe and secure so you can enjoy its many benefits for many years.
- The price of gold jumped 131 percent from late 2007 to September 2011, when it hit a high of $1,921 an ounce, according to the World Gold Council. (aarp.org)
- This is a 15% margin that has shown no stable direction of growth but fluctuates seemingly at random. (smartasset.com)
- Gold is considered a collectible, and profits from a sale are taxed at a maximum rate of 28 percent. (aarp.org)
- If you take distributions before hitting 59.5, you'll owe a 10% penalty on the amount withdrawn. (lendedu.com)
- Contribution limits$6,000 (49 and under) $7,000 (50 and up)$6,000 (49 and under) $7,000 (50 and up)$58,000 or 25% of your annual compensation (whichever is smaller) (lendedu.com)
- 7 U.S. Code SS 7 – Designation of boards of trade as contract markets
- 26 U.S. Code SS 408 – Individual retirement plans
3 Ways to Invest Gold for Retirement
It's crucial to understand where gold fits in your retirement strategy. You can invest in gold through your 401(k), if you have one at work. You may also want to consider investing in gold outside of your workplace. A custodial account can be opened by a brokerage firm like Fidelity Investments if you already have an IRA. Or, if you don't already own any precious metals, you may want to consider buying them directly from a reputable dealer.
These are three simple rules to help you make an investment in gold.
- Buy Gold with Your Cash – Don't use credit cards or borrow money to fund your investments. Instead, instead, transfer cash to your accounts. This will help protect you against inflation and keep your purchasing power high.
- Physical Gold Coins – Physical gold coins are better than a paper certificate. The reason is that it's much easier to sell physical gold coins than certificates. Physical gold coins are also free from storage fees.
- Diversify Your Portfolio – Never put all of your eggs in one basket. In other words, spread your wealth around by investing in different assets. This will reduce your risk and give you more flexibility in times of market volatility.
By: Jamie Redman
Title: Onyx Protocol Hack: A $2.1 Million Compromise in the DeFi Space
Sourced From: news.bitcoin.com/onyx-protocol-suffers-2-1m-loss-in-defi-breach-fraction-of-funds-redirected-to-tornado-cash/
Published Date: Wed, 01 Nov 2023 14:00:25 +0000