Bogged Finance Incident: Root Cause Analysis
Started at May-22–2021 02:47:06 PM +UTC, Bogged Finance was exploited to inflate the BOG balance, which is immediately sold to gain about $3.6M. The incident was due to a bug that allows the attacker to increase the balance via self-transfer. While it appears to be a flashloan attack, it is a flashswap-assisted one. In the following, we elaborate the technical details.
This incident was due to a bug in the BOG token contract that is designed to be deflationary by charging 5% of the transferred amount. Specifically, among the 5% charge, 1% is burned and 4% is taken as a fee for staking profit. However, the token contract implementation only charges 1% of the transferred amount but still inflates the 4% as the staking profit. As a result, the attacker can take advantage of flashloans to significantly increase the staking amount and repeatedly perform self-transfers to claim the inflated staking profit. After that, the attacker immediately sells the inflated BOG for about $3.6M WBNB.
The Hack Walk-through
We started the analysis from the transaction behind the hack: a986…2710. This hack is initialized from this attacker address (located at 0x4622) and works as follows:
- Step 1: Take nine flash-swaps and add liquidity into the WBNB+BOG pool. Each flash-swap leads to 47,770 BOG and the entire process consumes 88,159.43 WBNB with 83,440.57 LP token minted.
- Step 2: Stake the minted 83,440.57 WBNB+BOG LP tokens into the BOG token contract for profit sharing.
- Step 3: Perform 434 self-transfers in the total transfer amount of 18.74M BOG, resulting in an increased balance of 151K BOG.
- Step 4: Sell the extra BOG to WBNB, and then to anyETH.
- Step 5: Remove the added liquidity in Step 1 and complete the flash-swaps.
The Stolen Funds
This incident leads to the inflated balance of 151K BOG which was then sold by the attacker for $3.6M profit. Note the attacker’s funds from the above exploitations were initially held in this wallet: 0x4622. We are actively monitoring this wallet for any movement.
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