Bunni DEX shuts down after $8,4 million hack

Key points:

• Bunni DEX was hacked in September, resulting in losses of $8,4 million, after which the project decided to shut down.
• The team reported a lack of capital for a secure restart and audit.
• The developers have released the source code under an MIT license and are cooperating with law enforcement agencies.

The decentralized exchange Bunni DEX, built on Uniswap v4, announced its closure. In September, the project was attacked, resulting in hackers withdrawing $8,4 million. The team did not have the resources to recover: according to the developers’ estimates, the restart would have required months of work and six-figure costs.

In a statement on X, the developers noted that a full recovery of Bunni would require months of development and significant investment, which the project does not have.

Source: X.com

Details of the attack and the decision to shut down

The hacker attack that took place on September 2 targeted BunniHub, the protocol’s main smart contract module. The hack affected the Ethereum and Unichain networks. According to CertiK, the hackers exploited a rounding error in the withdrawal function. The stolen assets were transferred to two wallets, and some of them were laundered through Tornado Cash.

Immediately after the incident, the exchange suspended operations. Users were still able to withdraw assets through the interface. The remaining project funds will be distributed among BUNNI, LIT, and veBUNNI token holders. The team has excluded itself from this process until the legal review is complete.

Source code is now open source

Despite the closure, the developers decided to open the source code of the Bunni v2 smart contracts. The license was changed from Business Source License to MIT so that other projects could use the developments: liquidity distribution mechanics, volatility fees, and adaptive pool management functions.

The decision was welcomed by the crypto community as an example of an open approach to technology, even after the project’s closure. The team emphasized that it intends to maintain transparency and pass on valuable developments to the DeFi ecosystem.

Bunni became the second project to close in a week

Bunni’s closure came shortly after an announcement by the Kadena blockchain team, which also suspended operations due to unfavorable market conditions.

Analysts believe that these cases highlight the fragility of DeFi projects, especially those that cannot afford significant security and audit expenses.

Bunni continues to cooperate with law enforcement agencies to locate and recover the stolen funds. The team is offering a 10% reward for the voluntary return of assets.