Tallinn, Estonia--(Newsfile Corp. - April 10, 2022) - On March 20th, 2022, hackers exploited Umbrella Network's Polar Stream staking contracts on both Ethereum and BNB Chain and drained the LP tokens staked in both of the contracts. Umbrella Network had insurance coverage from decentralized insurance platform Uno Re and their claim has been accepted by the insurer.
Uno Re
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Umbrella Network announced the hack on Twitter the same day the incident happened.
It is reported that the attack was due to an underflow bug in the smart contract code. Hackers managed to withdraw liquidity using the stolen LP tokens from both the UMB-ETH Uniswap and the UMB-BNB Pancakeswap pools.
Subsequently, hackers were then able to sell over 2.2 million UMB tokens to the open market. Umbrella Network also notified users that their stolen UMB, BNB, and ETH will be returned to their wallets within 48 hours.
Following the incident, Umbrella Network's affected staking pool and any pending changes/new additions to Umbrella Network's policy have been temporarily frozen.
Besides the Umbrella Network hack, several staking pools have been compromised by hackers in the past year alone. It is worth mentioning that most of the compromised protocols have had their codes audited sometimes multiple times from a variety of reputed audit firms. However, the fact that even audited protocols get hacked points to the need for DeFi insurance as the stolen tokens in staking pools belong to no other than users.
Thankfully, Umbrella Network has already taken necessary precautions and partnered with a reputed insurance provider, Uno Re.
The details of the claim payout to be made by Uno Re
Uno Re and Umbrella Network's partnership began in August 2021. The partnership was formed to ensure compensation for users' possible losses due to unauthorized, malicious, or criminal acts specifically aiming at exploiting the smart contracts' code vulnerabilities.
As per the agreement, Uno Re processed the claim submitted by Umbrella Network. Upon the investigation conducted by Uno Re's Claims Assessment Team, the details have been forwarded to the Uno Re Claims Adjudication Committee for a vote and the committee has decided to accept the claim.
As a result, users whose assets are irrecoverably lost are entitled to receive up to $10k each as stated in the contract between Uno Re and Umbrella Network. In conclusion, 91% of affected wallet addresses are being covered and appropriately compensated as per the cover terms and conditions.
The claim payout amount will be processed from Uno Re's premium pool and will be carried out without utilizing any of the protocol's stalking pools ensuring zero capital erosion for the staked community.
Jaskanwar Singh, CEO, and Co-founder of Uno Re has stated "It is with regret that we observe the outbreaks of smart contract hacks within the DeFi space that cause users to lose their hard-earned assets. Uno Re dedicates itself to maintaining the security of the DeFi space to contribute to its growth. The partnership of Umbrella Network and Uno Re is a prime example of how DeFi insurance safeguards users' staked assets."
"This claim payout is the first one to be made by Uno Re, showcasing the efficacy and robustness of our protocol's risk management framework. Thanks to such strong alliances, the future of DeFi looks bright despite the presence of malicious actors," he added.
This hack further proves why insurance for crypto assets is absolutely essential to maintain a sustainable, safe, and long-lasting crypto ecosystem. As with previous staking pool hacks and the recent Umbrella Network hack, the real victim of smart contract exploitations are the users. As long as smart contract flaws remain, insurance will be the only guarantee users and protocols can rely on.
About Uno Re
Uno Re is the world's first decentralised insurance and reinsurance platform, allowing the community to invest and trade in 'risk' and receive sizable returns on their investments in one of the safest asset classes in the world. The platform will break barriers to entry for the retail investor by doing away with the historic pre-requisite of absurdly high capital generally needed to invest into the market while also introducing much-needed transparency into the industry as a whole. Uno Re will also allow the community to propose innovative insurance products to the space, thus propelling a new generation of Insurtech companies powered by the Uno Re ecosystem.
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Company Contact details:
Company Name: Uno Re
Contact Person: Misbah SP
Contact Person Title: Content/Marketing Ops
Twitter: @Misbah6SP
Company E-mail: misbah@unore.io
PR Contact:
Name - https://www.linkedin.com/in/sourav-ghosal-nca/
Website - www.newscoverage.agency
Email - touch@newscoverage.agency
Telegram - https://t.me/souravghosal_NCA
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