Acala Network to resume operations after burning 2.7 billion in USD stablecoin

A total of $2.97 billion minted in error has been recovered after the issue.

After the mining failure involving its stablecoin aUSD, the Acala network announced on Monday that it had resumed operations following a referendum allowing LPs to withdraw liquidity from pools or withdraw LP tokens.< /p>

The Community Referendum for Acala Stage 1 Resumption of Operations has been passed and executed.

LPs who choose to withdraw LP tokens or withdraw cash on Acala now have the option to do so. https://t.co/yzvOz7zwxT

In August, a misconfiguration of the iBTC/aUSD liquidity pool led to the erroneous minting of 3.022 billion aUSD, bringing its price below $0.01 against its dollar peg. Acala is a decentralized financial platform based on the Polkadot (DOT) ecosystem.

Wallet addresses that had received the minted aUSD were identified via on-chain tracing, recovering 2.97 billion aUSD mint errors from 16 addresses. Thirty-five other accounts were identified as having acquired 12.38 million aUSD issued in error.

According to the incident report, 16 iBTC/aUSD LP contributors received the error mints, and some of them repeatedly added more liquidity to the pool, claiming more aUSD error mints and resulting in the mistaken minting of more than aUSD. He noted:

“Some of these users repeatedly traded more aUSD error coins as the pool imbalance grew. They then transferred a significant amount of aUSD error coins to other chains and connected CEXs to XCM."

The cause of the incident "was a vulnerability in the DEX backup code that is part of the Incentive Palette", sai...