The liquidity pool (LP) of the DeFi project SafeMoon has been compromised, according to a statement from the project on Twitter on March 28.
SafeMoon LP compromised
SafeMoon said it was taking steps to fix the issue, but gave few other details about it. SafeMoon CEO John Karony (aka Captain Hodl) also retweeted the project’s initial statement on his personal Twitter account without further comment.
Although SafeMoon did not reveal the cause of the incident, others have commented on the matter. PeckShield Security Company says that a contract upgrade introduced a public burning bug – apparently allowing anyone to destroy tokens. PeckShield said the upgrade was initiated by the deployment contract and suggested the possibility of an admin key leak.
It’s unclear how much cryptocurrency – if any – was stolen or recovered.
The compromise comes at an inopportune time: SafeMoon recently promoted its security product, Orbital Shield. While the issue doesn’t appear to be directly related to Orbital Shield, the incident may not inspire confidence in the project’s broader security efforts.
SafeMoon’s native token (SFM) was slightly affected by the news. Token value was down 4.86% in the last 24 hours at 23:45 UTC.
SafeMoon plagued by controversy
SafeMoon is a DeFi-focused project that aims to provide investors with a way to earn interest on their investment through redistribution, LP acquisition, and token burns.
The project came under fire in 2022 following criticism from Coffeezilla. The YouTube host has alleged that the project’s former CEO, known only as “Kyle”, committed fraud. Coffeezilla also alleged that current CEO John Karony stole the project. The former CTO of SafeMoon had already responded to Coffeezilla’s earlier complaints.
SafeMoon has also been the target of numerous class action lawsuits, which have variously accused the project of being a pump-and-dump scheme and violating securities laws. The project’s SFM token experienced a sudden price spike in November 2022 when one such lawsuit was dropped, though those gains proved to be extremely short-lived.
As a result, SafeMoon has been plagued with controversy for much of its existence, and its SFM token has lost most of its value since its all-time high in March 2022.
Note: This article has been updated to include details of PeckShield.