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On October 17, 2024, Ambient Finance, a decentralized finance (DeFi) platform, faced a severe cybersecurity breach due to a domain name system (DNS) attack. Hackers compromised the platform’s website by taking control of its domain and inserting malicious links that aimed to pilfer user assets. Fortunately, Ambient Finance swiftly regained control of its domain, ensuring users that their smart contracts and funds remained secure throughout the ordeal.
Background on Ambient Finance
Ambient Finance was established in 2021 and has since grown to operate a decentralized exchange (DEX). The platform gained significant attention in the previous year when it managed to raise $6 million in a seed funding round, attracting notable investments from firms such as Blocktower and Circle Ventures. This strong financial backing has positioned Ambient Finance as a key player within the DeFi landscape.
Details of the DNS Attack
The attack on Ambient Finance began when hackers breached the platform’s DNS, allowing them to redirect users to fraudulent links with the intent of stealing digital assets. In response, the Ambient Finance team took immediate action by notifying users through the social media platform X (formerly Twitter), urging them to refrain from interacting with the compromised site, connecting their wallets, or signing any transactions.
The official tweet from the Ambient Finance team stated: “The Ambient Finance website domain has been hijacked and compromised. The issue is isolated to the frontend website; contracts and funds are safe.” They emphasized the importance of waiting for further updates before attempting to return to the platform.
Impact of the Attack
DNS attacks focus primarily on a platform’s domain registrar credentials, which gives hackers control over the website’s interface while generally leaving backend smart contracts intact. In the case of Ambient Finance, the integrity of its smart contracts and on-chain infrastructure was not compromised despite the frontend breach.
Just two hours after the initial breach, Ambient Finance provided an update to its users, confirming that they had successfully regained control of their domain. Due to inherent DNS propagation delays, the team advised users to wait for confirmation of the domain updates before interacting with the site again.
Technical Aspects of the Attack
The malware utilized in the attack, known as Inferno Drainer, is infamous for its capability to steal digital assets swiftly. Cybersecurity firm Blockaid conducted an analysis of the breach, revealing that the server orchestrating the hack was established just 24 hours before the incident. Their tweet noted, “The drainer kit used in this attack is Inferno Drainer. Interestingly, looks like the C2 server used here was created specifically for this attack – it was registered in the last 24h.”
The Rising Threat of Cyber Attacks in DeFi
The frequency of DNS-based attacks has surged recently, with other prominent DeFi platforms, such as Ethena Labs, falling victim to similar breaches in 2024. Ethena Labs announced: “The Ethena domain registrar account was recently compromised and we have taken steps to deactivate the site until further notice. The protocol is unaffected and funds are safe. Please do not interact with any site or application purporting to be the Ethena frontend.”
These types of attacks exploit weaknesses in a platform’s web infrastructure, especially concerning its domain registration. They aim to deceive users into disclosing sensitive information or signing harmful transactions. In Ambient Finance’s case, their swift recovery of the compromised domain likely mitigated more serious ramifications, protecting users from further danger.
While backend smart contracts often remain secure, vulnerabilities at the frontend, such as those presented by DNS attacks, can expose users to significant risks. Notably, in September, the automated market maker Balancer suffered a frontend exploit following a social engineering attack, demonstrating that such threats are prevalent.
Current Cybersecurity Landscape in DeFi
A recent report from Immunefi highlighted that in the third quarter of 2024, crypto hacks and scams resulted in losses totaling $413 million, representing a sharp decline compared to the $686 million lost in the same quarter of the previous year. Despite this decrease in total losses, the threat to DeFi platforms remains substantial, underscoring the need for ongoing vigilance and robust security measures.
Following the recent string of attacks in the DeFi space, Radiant Capital, a cross-chain lending protocol backed by Binance, was also hacked on the same day as the Ambient Finance incident, leading to over $50 million worth of stolen assets. This continuing trend of sophisticated cyber threats signals the necessity for users and platforms alike to enhance their security protocols.
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