Balancer is set to compensate the victims of the $450,000 exploit it recently suffered, and to reward a white hat hacker that submitted, in May, a bug bounty report to the firm describing the exploit that was used against it.

Binance is reportedly finalizing a deal to buy a majority stake in the cryptocurrency startup Swipe, in a move that could see it move one step forward to launch its own crypto debit card, the Binance Card.

Researchers have warned a new type of attack against Bitcoin’s Lightning Network could create “chaos” and allow attackers to steal funds.

Top stories in the Crypto Roundup today:

• DeFi Protocol Balancer to Compensate Victims of $450,000 Exploit
• Binance Reportedly Finalizing Deal to Buy Majority stake in Swipe
• New Lightning Network Attack Could Create ‘Chaos’, Researchers Warn

At the time of writing, bitcoin (BTC) is trading at $9,121.76 (0.43%) with a daily Top Tier volume of $1.87 bn. As for ether (ETH), it is trading at $226.11 (1.45%) with a daily Top Tier volume of $603.79 million. The MVIS CryptoCompare Digital Assets 10 Index is currently tracking at 2,973.04 (-0.82%).

DeFi Protocol Balancer to Compensate Victims of $450,000 Exploit

Decentralized finance market-making protocol Balancer has announced it will move to compensate users who lost tokens in an attack that took advantage of two deflationary tokens to take over $450,000 worth of crypto from its pools.

The protocol is also going to reward Ankur Agrawal of Hex Capital the “maximum amount” available in its bug bounty program, as he flagged the problem that was ultimately exploited on May 6. In a Medium post, Balancer CEO Fernando Martinelli wrote:

"The bug bounty report [by Agrawal] describes in detail the attack that happened. Our team however did not think it would be a practical attack because of the enormous amounts of funds and also gas we thought would be required for bringing the balance of the deflationary token to near 0 in a single atomic transaction.”

According to The Block, Balancer initially refused to pay out the bounty as they determined “it was not a critical bug.” The exploit took advantage of pools using deflationary tokens STONK and STA, which charge transfer fees when trading. Balancer pools do not immediately take those fees into account, meaning the pool balance went close to 0 while the pool balance showed more than was actually there.

Details of the reimbursement are expected to be announced later this week.

Binance Reportedly Finalizing Deal to Buy Majority stake in Swipe

Binance is reportedly finalizing a deal to acquire a majority stake in the cryptocurrency startup Swipe.io. The move would pave the way for the cryptocurrency exchange to roll out its branded payments card.

Binance has earlier this year announced the launch of its Binance Card, which “does everything a regular payment card does, plus much more.” The card will, according to The Block, be issued as a white-label product via Swipe, which offers a multi-currency crypto wallet app and a crypto-to-fiat funded Visa debit card.

The cards are issued by Contis Financial Services, a Visa member licensed by the Financial Conduct Authority in the U.K. Other crypto firms, including Coinbase, Crypto.com, and BitPay have also issued their own crypto debit cards, it’s worth noting.

New Lightning Network Attack Could Create ‘Chaos’, Researchers Warn

A study published by Jona Harris and Aviv Zohar from the Hebrew University of Jerusalem evaluated a potential systemic attack on Bitcoin’s layer-two scaling solution, the Lightning Network, for the theft of BTC locked in payment channels.

It found that using the network to send payments through intermediary nodes could be leveraged to steal the funds, if done quickly. Potential hackers could extend their window of time flooding the network.

For the attack to be successful, the study adds, hackers would need to attack 85 channels at the same time. The researchers added:

“Our attacker will route a payment between his own two nodes, and pull the payment at the end of the path. He will refuse to cooperate when the payment is eventually pulled from the source node - forcing the victim to do so via a blockchain transaction.”

Before being released, the results of the study were shared with the developers of the three main Lightning Network implementations.

Qtum (QTUM) is the Daily Mover

This week’s Daily Mover featured asset is Qtum (QTUM), a blockchain designed ot merge Ethereum’s smart contract element with the stable characteristics of Bitcoin, as well as a proof-of-stake consensus mechanism to verify ownership.

Qtum is aimed at enterprises and has been live since September 2017. Decentralized applications built on ETH are compatible with QTUM. In the past 10 days, its FCAS score went up 3.53% thanks to a 28-point climb in Developer Behavior, while its User Activity and Market Maturity remained stable.

The rise came as the Qtum community tests a new offline staking feature that went live on the testnet this week. The featured, coming from the Qtum Improvement Proposal 25 (QIP - 25) explains how offline addresses can securely delegate their coins to online Super Staker nodes, which run the Proof-of-Stake consensus for the funds stored offline via a smart contract.

This would allow users to run full nodes and validate transactions without having to sync the entire blockchain or stay online 24/7. If successful, Qtum will be the first blockchain to offer offline staking of its cryptocurrency, a significant incentive for new users and investors.

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