The bridge between the $XRP Ledger (XRPL) and the transaction network has been suspended after a critical vulnerability in the software was exploited. An attacker created bridge $XRP without any actual deposits in $XRP, making it appear as valid deposits made to the bridge, and then withdrew real $XRP from the bridge's reserve.
According to a statement from the transaction team, the attack occurred on August 9th. Due to a flaw in the bridge's investment detection mechanism, some transactions were recorded by the system as successful deposits, even though no $XRP had arrived at the bridge's address on the $XRP Ledger.
Fake $XRP Balances Were Created.
The attacker exploited this vulnerability to create bridge $XRP balances on the transaction chain that were not actually backed by collateral. These unbacked balances were then used to withdraw real $XRP from the bridge reserve on the $XRP Ledger.
The technical inspection team issued the following statement regarding the incident:
"The bridge software mistakenly recorded transactions as investments that did not actually bring any $XRP to the bridge, and in response, created bridge-backed $XRP on the transaction blockchain. The attacker then used these unbacked balances to withdraw real $XRP from the reserve."
The company also stated that the bridge in question underwent numerous internal and third-party security audits before being made available, but the attacker exploited a previously undiscovered vulnerability.
The estimated stolen amount is 200,000 $XRP (approximately $200,000 USD).
According to information provided by tx, the impact of the attack was limited to bridge $XRP on the tx blockchain. Following the attack, it was declared that all circulating bridge $XRP were no longer backed one-to-one with real $XRP reserves.
Reportedly, all other collateralized assets were fully insured.
The team also emphasized that user tokens and funds stored on centralized exchanges, decentralized exchanges, or directly on the blockchain were not affected by the incident.
Upon discovering the incident, the connection between XRPL and tx was severed. It is reported that the security vulnerability was identified, and the necessary fixes to the code that caused it have been implemented.
Among other steps taken by the tx team following the attack are tracking the movement of the stolen funds across various blockchain networks and collaborating with blockchain data analysis firms.
The company also announced the filing of a formal complaint with the FBI's Internet Crime Complaint Center (IC3), containing all transaction records related to the attack and additional information that could help identify the perpetrator.
TX company management stated that various options for compensating users affected by the incident are being considered.
The company said details about the compensation mechanism to be implemented and the timeline for the process will be communicated in a new statement to be issued later.
However, tx company announced that all available legal means would be used to identify and hold the attacker accountable.
The XRPL intercepting channel will remain closed until security reviews and system upgrades are completed.
*This is not investment advice.
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