Cover Protocol, a peer-to-peer insurance marketplace listed on Binance’s Innovation Zone, shut down after its core developers left. The “shutdown” was announced in a blog post on Cover Protocol’s official Twitter handle. As stated in the blog,
“This was not an easy decision to make, and it is a final decision made by the remaining team after reviewing the path forward after the core developers abruptly left the projects.”
The decision to shut down came after a lengthy and exhausting process of attempting to stabilize operations after it was hacked late last year. According to the blog, “DefiTed,”
“I want to express how disappointed I was to learn that the development team was leaving so abruptly, especially given the time we had spent together building out the protocols and adhering to the vision they had.”
On December 28, 2020, the aforementioned project was attacked, and the hacker was able to duplicate the native COVER token and swap it for ETH, DAI, and WBTC, resulting in a $4 million loss in crypto. Despite the fact that the “white hat” hacker returned the funds, the project was unable to find solid grounds to proceed.
It is worth noting that such an attack was not unprecedented for Binance Smart Chain (BSC)-based projects. Several DeFi projects have been attacked in recent months. One such attack occurred in July on projects hosted on the Chainswap protocol, resulting in a loss of millions of dollars.
Meanwhile, in May, BurgerSwap [BURGER] and JulSwap [JULD] experienced flash loan attacks, resulting in a $7.2 million loss. BSC stated at the time that these were targeted and organized attacks.
Furthermore, Binance CEO Chanpeng Zhao stated that “nothing is safe” when discussing the recent Poly Network hack, which resulted in a loss of nearly $611 million. Zhao also stated that the assets stolen by the hackers should be frozen jointly. While exchanges were eager to increase security measures to deter such behavior, users are still at risk due to the recent increase in DeFi hacks.