Balancer has issued a warning to certain liquidity providers to remove their funds from these pools due to a “problem”. BAL has been trading in a tight range since last Christmas as investors wait for a catalyst to drive prices higher.
In a series of tweets published Jan. 6, decentralized exchange protocol Balancer [BAL] informed users that a “problem” with exchange liquidity pools has turned the protocol fees of some of its pools to zero.
Protocol fees of some Balancer pools have been set to 0 to avoid an issue that has now been fixed and will be made public in the near future.
This was done by the emergency multisig, a 4/7 consisting of BLabs engineers and Balancer Maxis: https://t.co/AZo7yBQD17
— Balance (@Balancer) January 6, 2023
Affected pools include DOLA/bb-a-USD on Ethereum [ETH]bb-am-USD/miMATIC on Polygon [MATIC], It’s MAI Life and Smells Like Spartan Spirit on Optimism [OP]and Tenacious Dollar on Fantom [FTM].
Are your positions flashing green? Check the BAL profit calculator
The aftermath of the “problem”
According to the tweet, the problem had been,
“Attenuated and will be made public in the near future.”
In addition, the decision was made to set the protocol rates for the affected pools to zero by the emergency multisig. So does not require any further action for liquidity providers.
Balancers Emergency subDAO was launched to enable a small group to take action in the event of malicious activity and/or possible loss of funds on the protocol.
In a later tweet, Balancer issued another warning to liquidity providers on the affected pools, saying:
“Due to a related issue, LPs from the following pools should remove their liquidity as soon as possible as the issue cannot be resolved by the emergency DAO.”
IMPORTANT: Due to a related issue, LPs from the following pools must remove their liquidity as soon as possible, as the issue cannot be resolved by the emergency DAO. https://t.co/WcBeBvjdY2
— Balance (@Balancer) January 6, 2023
In June 2020, Balancer hacked for over $450,000 worth of multiple tokens due to a vulnerability in two of Balancer’s pools containing the STA and STONK tokens.
According to Balancer, it was not previously aware that this type of attack was possible. But a Twitter user Hex capitaldisputed this claim.
He claimed the hacker could be exploiting a vulnerability that was already reported to Balancer during its bug bounty program in May, but was not acknowledged by the company. In addition, the user claimed to have submitted a detailed attack vector report to Balancer.
“Although we didn’t know this particular type of attack was possible” – this is blatantly false @mikeraymcdonald @BalancerLabs. I submitted this exact attack vector to your bug bounty program on 6/5 and payment was declined. cc @defiprime @The block__ @VitalikButerin @1inchExchange
— hexacapital.eth (@Hex_Capital) June 29, 2020
How many BALs can you get for $1?
The story of Balancer’s governance token, BAL
At the time of writing, BAL was trading at $5.40. Undeterred by news of a potential exploit, BAL’s price rose 2% over the past 24 hours. In addition, trading volume grew 5% over the same period, data from CoinMarketCap showed.
A review of BAL’s performance on a daily chart revealed that the alt has been trading in a tight range since December 25, 2022. When an asset is trading within a tight range, the asset’s price fluctuates within a narrow band and has not made significant moves in either direction.
Interestingly, BAL’s Chaikin Money Flow (CMF) trended upward during this period. At the time of going to press, the dynamic line (green) was pegged above the center line at 0.09.
Typically, a rising CMF indicates more buying pressure than selling pressure. Therefore, if the price of an asset is trading within a narrow range, but the CMF is rising, it may indicate that there are more buyers than sellers entering the market, despite the lack of significant price movement.
This could indicate the underlying strength of the asset, as the buyers can trust that the price will eventually break out of the current range and move higher.
This post balancer [BAL]: Investors regain confidence despite ‘problems’ with liquidity pools
was published first on https://ambcrypto.com/balancer-bal-investors-renew-faith-despite-issues-with-liquidity-pools/