The Acala Network’s aUSD stablecoin depegged by over 99% and forced the team to pause a hacker’s wallet, raising concerns about its claim of being decentralized.
The hacker took advantage of a bug on the iBTC/aUSD liquidity pool which resulted in 1.2 billion aUSD being minted without collateral. This event crashed the USD-pegged stablecoin to a cent, and in response, the Acala team froze the invalidly minted tokens by placing the network in maintenance mode.
The move also halted other features such as swaps, xcm (cross-chain communications on Polkadot), and the oracle pallet price feeds until “further notice”
While the decision to put the network in maintenance mode and freeze funds in the hacker’s wallet may have been meant to protect users and the network from any further harm, advocates of decentralization have raised their concerns.
Community members have noted the mockery of Acala’s claims about aUSD’s censorship-resistance since the protocol froze funds so quickly. A member of the project’s Discord channel proposed rolling back the chain to reverse the token mints altogether, but was challenged by another member.
The network was in maintenance mode to block all token transfers, but the team confirmed that the bug had been fixed. The wallets that received erroneously minted aUSD have been identified, and 99% of them were still on Acala which leaves the possibility that they may be retrieved by the community if it votes to do so.
