The Convex Finance team used a new smart contract to resolve the bug, resulting in the unlocking of millions of CVX tokens.
The Convex Finance team warned users on Twitter on March 4 that it had reallocated the smart contracts responsible for the vote blocking management mechanism? after discovering a bug that would provide some users with disproportionate rewards.
“There were no use cases [of the bug] prior to the deployment of the new vlCVX contract. However, since Convex Finance contracts are immutable and cannot be updated, a new contract had to be deployed. The new vlCVX contract implements a fix for this potential bug.
The bug fix resulted in the unlocking of millions of tokens, which was reflected in the price of CRV. The reason for the chaos in the market was the Convex vote blocking mechanism, which is the key to the project’s tokenomics. It allows users to earn rewards from protocols and channel liquidity deposits to another Curve Finance protocol, but only if users lock their tokens for 16 weeks.
This mechanism plays a key role in the complex multi-layered battle for control of the Curve Finance protocol token. The vote blocking mechanism is used in CVX negotiable supply management. Loyal CVX traders keep track of major unlock dates as they can cause supply and price fluctuations.
Despite the fluctuations in the CVX market, everything went more or less smoothly. It is much safer for users and the project when the team finds the exploit on their own and eliminates it before hackers use it to carry out cyberattacks. Recently, the largest platform for the issuance and trading of NFT Treasure based on the Arbitrum solution was attacked by hackers. In February, cybercriminals hacked into Dego Finance and took tokens from liquidity pools. Realizing that cybersecurity specialists are not always able to identify vulnerabilities, teams hire “white hat” hackers to find exploits. In February, the Cardano project team announced that they were doubling the rewards for “white hat hackers” for finding vulnerabilities in the wallet and network to ensure the maximum security of the ecosystem.
